Global Direct Reduced Iron Market Size Likely to Grow at a CAGR of 7.5% By 2034

Market Size and Growth

As per the Direct Reduced Iron Market size analysis conducted by the CMI Team, the global Direct Reduced Iron market is expected to record a CAGR of 7.5% from 2025 to 2034. In 2025, the market size is projected to reach a valuation of USD 50.3 Billion. By 2034, the valuation is anticipated to reach USD 96.4 Billion.

Overview

According to industry experts at CMI, Direct reduced iron (DRI), also known as sponge iron, is a solid form of metallic iron made by eliminating oxygen from iron ore at temperatures lower than its melting point. It is produced by a method known as direct reduction, which uses solid or gaseous reducing agents such as hydrogen and carbon monoxide to convert iron oxides to metallic iron without melting.

The resulting porous, sponge-like product is a valuable raw material for steel production, frequently substituting steel scrap. The direct reduced iron market is being driven by several factor such as the growing steel industry, increasing investment in infrastructure development, and growing demand from end-use sector such as automotive, aerospace and others. However, the feedstock and pellet shortage hamper the industry growth over the analysis period.

Key Trends & Drivers

• Growing partnership among the market players: The rising partnership among the key market players is expected to florish the industry expansion over the forecast period. For instance, in April 2025, Clariant, a specialty chemical business focusing on sustainability, announced that it has maintained its successful partnership with Midrex and will increase collaboration in direct reduced iron (DRI) technology for steel manufacturing. Natural gas-based DRI is a low-carbon alternative to traditional coal-based ironmaking, using natural gas with recovered CO₂ and H₂O to produce reducing gas for the production process. The technique combines MIDREX® Reformers with Clariant-manufactured REFORMEX® Catalysts, which provide superior activity and stability while increasing productivity, lowering energy usage, and reducing carbon emissions. The MIDREX DRI method saves approximately one ton of CO₂ for every ton of basic steel.

• Incentives and policy support: There are many government policies and incentives around the world that enable the Direct Reduced Iron (DRI) sector to grow. One of these is the move to make steel in a way that is better for the environment and has less carbon. Governments grant tax breaks and incentives to induce people to invest in cleaner steelmaking that uses DRI, notably hydrogen-based DRI, which is frequently called “green DRI.” These financial incentives make it cheaper to get money for initiatives and make them more likely to succeed. For instance, the US and other countries offer tax breaks and other incentives to businesses that use green technologies to make clean steel. India and other nations have initiated significant government efforts to create green steel. These projects include concessional loans, risk assurances, and financial tools that will help both primary and secondary steel mills use DRI and green technologies. India’s Green Steel Mission, which costs ₹5,000 crore, intends to make a lot more steel in a way that is good for the environment by 2050.

Report Scope

SWOT Analysis

• Strengths: The growing regulatory and environmental support is a main strength that drives the industry expansion, as the government across the globe is forcing the stringent regulation for factories and also providing incentives to adopt sustainable technology.

• Weakness: The major weakness for the market growth is the dependence on natural gas and hydrogen. Hydrogen is an emerging technology that is more expensive to adopt, and they are in the initial stage for procurement.

• Opportunities: The rapid infrastructure development, urbanization, and industrial growth in Asia-Pacific, the Middle East, and Africa, among other places, are driving up steel demand. These regions could be significant growth markets for DRI.

• Threats: Storage/self-heating concerns, transportation challenges, building hydrogen infrastructure, addressing reoxidation, and so on. These increase costs and risks.

Leading Players

The Direct Reduced Iron market is highly competitive, with a large number of service providers globally. Some of the key players in the market include:

• MIDREX technologies
• KOBE STEEL LTD.
• Jindal steel and power
• Metinvest Holding LLC
• Tenova HYL SA
• JSW Steel Limited
• Qatar Steel Company FZE
• Nucor Corporation
• Essar Steel India Limited
• JFE Steel India Limited
• Iron Dynamics LLC
• Tata Steel Limited
• NLMK Group
• SAIL
• Lloyds Metals and Energy Limited
• Others

The Direct Reduced Iron Market is segmented as follows:

By Product Type

• Hot Briquetted Iron
• Cold Direct Reduced Iron

By Technology

• Gas Based
• Coal Based

By Application

• Steelmaking
• Electric Arc Furnace
• Basic Oxygen Furnace
• Foundries
• Others

By Industry Vertical

• Construction
• Automotive
• Aerospace
• Others

Regional Coverage:

North America

• U.S.
• Canada
• Mexico
• Rest of North America

Europe

• Germany
• France
• U.K.
• Russia
• Italy
• Spain
• Netherlands
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• New Zealand
• Australia
• South Korea
• Taiwan
• Rest of Asia Pacific

The Middle East & Africa

• Saudi Arabia
• UAE
• Egypt
• Kuwait
• South Africa
• Rest of the Middle East & Africa

Latin America

• Brazil
• Argentina
• Rest of Latin America