The Sponge Iron / DRI Production Process Explained

Sponge iron, also called direct reduced iron (DRI), is iron produced by reducing iron ore to metallic iron in the solid state, below the melting point of iron, without ever forming a liquid melt. It is the feedstock that has reshaped electric-arc-furnace steelmaking, and it is produced at scale in India more than anywhere else on earth: India made 54.7 million tonnes of DRI in 2024, roughly 39% of the world total of 140.8 million tonnes, and has been the world's largest producer every year since 2003 [1][2]. This guide covers what sponge iron is, the two production routes (coal-based and gas-based), the rotary-kiln process stage by stage with its temperature profile and operating parameters, why kiln sealing is a harder problem in DRI than in cement, the operational challenges every DRI kiln fights, the material balance, and the plant economics.

What is sponge iron / direct reduced iron (DRI)?

Sponge iron is iron ore from which the oxygen has been removed by a reducing gas (carbon monoxide and hydrogen) at temperatures below iron's melting point, leaving a porous, metallic-iron product that retains the shape of the original ore particle. Because the ore is never melted, the reduction is described as direct, hence "direct reduced iron." The product is used mainly as a clean, consistent charge for electric arc furnaces and induction furnaces, where it substitutes for scrap.

India dominates this process. Of the 140.8 million tonnes of DRI produced worldwide in 2024, India produced 54.7 million tonnes, about 39%, the largest share of any country and more than the next two producers combined [1][2]. That concentration is why the metallurgical kiln applications Oswal serves are weighted heavily toward Indian sponge iron plants, and why the operating detail below is written around the coal-based rotary kiln that dominates the Indian fleet.

Sponge iron (direct reduced iron, DRI): iron produced by reducing iron oxide to metallic iron in the solid state, at 800-1,100 degC, using carbon monoxide and hydrogen derived from coal or natural gas. The ore is never melted; oxygen is stripped chemically, leaving a porous metallic structure.

The "sponge" name is literal. Stripping oxygen out of the ore lattice leaves voids where the oxygen atoms used to be, so the reduced particle is shot through with pores and looks like a metallic sponge under magnification. That porous structure is covered in more depth in the companion piece on why it is called sponge iron.

Metallization: the percentage of total iron in the product that is present as metallic iron rather than as residual iron oxide. Metallization = (metallic iron / total iron) x 100. Commercial DRI targets 90% or higher; gas-based product reaches 92-95%, coal-based rotary-kiln product around 92-93% [3][4].

Coal-based vs gas-based DRI: the two dominant routes

There are two commercial routes to sponge iron, distinguished by the reductant and the reactor: the coal-based route uses non-coking coal in an inclined rotary kiln, and the gas-based route uses reformed natural gas in a vertical shaft furnace. Globally the gas route is larger (about 68.5% of 2024 output) because it suits gas-rich regions like the Middle East and North America; the coal route (about 31.5%) is concentrated in India, which holds roughly 92.8% of the world's coal-based DRI capacity [2][5].

The choice is driven by feedstock availability, not by any inherent superiority. India built its DRI industry on domestic non-coking coal and abundant small-scale rotary kilns because natural gas was scarce and expensive; the Middle East and North Africa built theirs on cheap natural gas and large shaft furnaces. The two routes produce a similar product but run at different temperatures, scales, and metallization levels.

Attribute	Coal-based (rotary kiln)	Gas-based (shaft furnace)
Reductant	Non-coking coal (solid)	Reformed natural gas (syngas, 90-92% H2 + CO)
Reactor	Inclined rotary kiln	Vertical shaft furnace
Reduction temperature	1,000-1,100 degC [3]	800-900 degC; furnace ~950 degC [4]
Typical metallization	~92-93% [3]	~92-95% [4]
Product carbon	0.1-0.2% [3]	0.5-2.5% (controllable) [4]
Dominant geography	India	Middle East, North Africa, Americas
Named processes	SL/RN, Jindal, Codir	MIDREX, HYL / Energiron

Sources per row. Global route split and geography per Midrex World Direct Reduction Statistics [2][5].

The coal route is covered in detail in coal-based sponge iron production, the gas route in gas-based DRI direct reduction, and the head-to-head trade-offs in coal-based vs gas-based DRI. The rest of this guide focuses on the coal-based rotary kiln, because it is the dominant route in Oswal's primary market and the one where kiln sealing is the load-bearing engineering problem.

The DRI rotary kiln process: flow, temperature profile, residence time

The coal-based DRI rotary kiln runs material through four named stages along a single inclined tube: preheating, reduction, then discharge into a separate rotary cooler. Iron ore (lump or pellet), non-coking coal, and a small dolomite flux are charged at the elevated feed end; the kiln rotates slowly and is inclined about 2.5 degrees, so the bed migrates toward the discharge end over roughly 7 to 8 hours [3].

The process flow, by named stage:

1. Charging. Sized iron ore, non-coking coal, and dolomite enter the elevated feed end. Part of the coal is also injected from the discharge end as it travels along the kiln.
2. Preheating zone. The first 40-50% of the kiln length. The charge is heated to 600-800 degC; moisture and coal volatiles are driven off and combusted [3].
3. Reduction zone. The hot zone at 1,000-1,100 degC, where carbon monoxide generated from the coal reduces iron oxide to metallic iron in the solid state. This is where metallization happens [3].
4. Discharge and cooling. The hot sponge iron leaves the kiln and enters a separate water-cooled rotary cooler, where it is cooled to about 100 degC under a non-oxidising condition before magnetic separation splits the product DRI from spent char [3].

The temperature profile is the spine of the process. Too cool, and reduction is incomplete (low metallization). Too hot, and the bed sinters into accretions that build into rings, the failure mode covered below.

Zone	Temperature	Function	Share of kiln length
Preheating	600-800 degC	Drying, volatile release and combustion	40-50%
Reduction	1,000-1,100 degC	Solid-state reduction of iron oxide to metallic iron	balance of length
Cooling (separate cooler)	down to ~100 degC	Cool product under non-oxidising condition before separation	external rotary cooler

Source: IspatGuru, coal-based direct reduction rotary kiln process [3].

The kiln is fired by combusting the coal volatiles and the carbon monoxide leaving the bed; air for that combustion is injected along the length of the kiln through heat-resistant shell-mounted air tubes, and the air-to-fuel ratio along the kiln is what holds the bed reducing while the freeboard above it burns the off-gas [3]. The numeric operating envelope for a typical Indian coal-based unit:

Parameter	Typical value	Source
Plant capacity	30,000-150,000 tonnes/year per kiln	IspatGuru [3]
Reduction-zone temperature	1,000-1,100 degC	IspatGuru [3]
Material residence time in kiln	7-8 hours	IspatGuru [3]
Kiln inclination	~2.5 degrees	IspatGuru [3]
Rotation speed	0.2-1.0 rpm	IspatGuru [3]
Fuel energy	~6 Gcal per tonne of DRI	IspatGuru [3]
Metallization	~92-93%	IspatGuru [3]
Product carbon	0.1-0.2%	IspatGuru [3]

The rotary kiln itself is mechanically similar to a cement manufacturing process kiln: an inclined rotating steel shell, refractory-lined, on tyre-and-roller supports, with a stationary hood at each end. The metallurgy inside is the opposite, though. A cement kiln runs an oxidising flame to clinker the meal; a DRI kiln must hold the bed reducing, which changes the sealing requirement completely.

Why kiln sealing matters in DRI: reducing atmosphere needs near-zero air ingress

In a DRI rotary kiln the interior must hold a reducing atmosphere, so any air drawn in through a worn seal re-oxidises the freshly reduced sponge iron, drops the metallization, and wastes reductant. This is the single most important difference between DRI and cement sealing: in a cement kiln, air ingress (false air) is an efficiency loss; in a DRI kiln, it is a product-quality and process-control failure.

Reducing atmosphere: a kiln-gas environment with a high ratio of carbon monoxide and hydrogen to carbon dioxide and oxygen, which strips oxygen from iron oxide rather than adding it. Maintaining it requires excluding ambient air, which carries 20.9% oxygen, from the reduction zone.

Consider the contrast directly. In cement, uncontrolled air ingress, called false air, costs roughly 1.5-2.5 kcal/kg clinker per percentage point and loads the induced-draft fan, but it does not ruin the clinker; the penalty is fuel and electricity. In DRI, the same leak does direct chemical damage: oxygen reaching the reduction zone re-oxidises metallic iron back to FeO, so metallization falls below the 90% commercial floor and the product is downgraded or rejected. The economic logic of a kiln seal therefore inverts. In cement the seal pays back through fuel savings; in DRI it protects saleable product yield and the reducing-atmosphere control the whole process depends on.

That is why the sealing tolerance at the kiln inlet and outlet interfaces is tighter in DRI than in almost any other rotary-kiln application Oswal serves. The rotating shell still expands radially, moves axially under thermal growth, and carries residual ovality, so a rigid seal still fails, but here the consequence of a failed seal is measured in lost metallization, not just lost fuel. The Duplex Kiln Sealing System combines lamella flexibility for movement adaptation with graphite durability for the high-temperature, abrasive, dust-laden discharge interface, and high-temperature radial seals handle the radial movement at the hot end. The full DRI-specific sealing case, including the reducing-atmosphere engineering and the inlet/outlet interface detail, is in kiln sealing in DRI plants.

Common DRI kiln operational challenges: accretion, ring formation, blockages

The dominant operational problem in a coal-based DRI kiln is accretion: sticky, low-melting deposits that build up on the refractory, grow into rings that restrict the kiln bore, and force the kiln down for cleaning. Accretion is responsible for the majority of unplanned DRI-kiln shutdowns [3][6]. The other recurring issues are air-tube blockages and metallization swings driven by temperature and gas-balance instability.

Accretions form when fine particles agglomerate near the charge end, or when the bed sinters near the discharge end because the temperature ran too high or the carbon-to-iron ratio ran too low [3]. Low-melting complex compounds in the gangue and ash (iron-alkali silicates, for example) soften, bind particles to the wall, and the deposit grows ring by ring. The practical control lever is temperature: operators hold the reduction zone within the 1,000-1,100 degC band specifically because going above it sharply accelerates ring formation [3][6].

Challenge	Mechanism	Mitigation
Accretion / ring formation	Low-melting silicate and alkali phases soften above ~1,000-1,100 degC and bind the bed to the refractory; rings restrict the bore	Hold reduction temperature in band; control coal ash and alkali; profile air injection; scheduled ring cutting [3][6]
Air-tube blockage	Shell-mounted air tubes foul with dust and accretion, disturbing the air-to-fuel profile along the kiln	Routine tube inspection and rodding; air-flow monitoring [3]
Low / variable metallization	Reduction temperature too low, residence time too short, or air ingress re-oxidising the bed	Temperature and residence-time control; seal integrity to exclude ambient air [3]
Refractory and shell wear	Abrasive bed plus thermal cycling at the hot end	Refractory management; seal selection that survives thermal cycling

Air ingress through a degraded seal sits underneath two of these rows at once: it re-oxidises product (the metallization row) and it disturbs the carefully profiled air-to-fuel balance the operator uses to keep the bed reducing and the temperature in band. A kiln that has become hard to drive, with drifting metallization and rising ring frequency, is often describing a sealing problem nobody has yet quantified, the same pattern Oswal sees on the cement side with false air.

Material flow: iron ore + coal/gas to sponge iron + char/CO2

The coal-based DRI kiln is a solid-bed reactor whose inputs are iron ore, non-coking coal, and a dolomite flux, and whose outputs are sponge iron, spent char, and a carbon-monoxide-rich off-gas. Roughly speaking, the carbon in the coal supplies both the heat (by combustion in the freeboard) and the reductant (as carbon monoxide generated in the bed), while the dolomite controls sulphur from the coal.

Stream	Role	Typical figure / note
Iron ore (lump or pellet)	Source of iron; reduced in the solid state	Sized feed; quality drives metallization and accretion behaviour
Non-coking coal	Reductant (CO generation) and fuel	India's DRI industry is built on domestic non-coking coal [5]
Dolomite flux	Sulphur capture from coal	Small addition relative to ore and coal
Combustion air	Burns volatiles and off-gas CO in the freeboard	Injected along the shell through heat-resistant air tubes [3]
Sponge iron (product)	EAF / induction-furnace charge	~92-93% metallization, 0.1-0.2% C [3]
Char / dolochar	Spent coal residue	Separated magnetically; often fired in captive power plants
Kiln off-gas (CO / CO2)	Waste-gas energy stream	Afterburned; heat recovered for captive power generation

The char and waste-heat streams are a defining feature of the Indian DRI sector. The carbon monoxide leaving the bed is afterburned and the heat is commonly recovered in a waste-heat recovery boiler driving captive power, and the spent char is fired in adjacent fluidised-bed boilers, so a sponge iron plant and a captive power plant are usually built as one unit. That integration is part of why coal-based DRI remains economic in India despite its higher carbon intensity than the gas route.

DRI plant economics: energy and feedstock cost share

In a coal-based DRI plant, raw materials (iron ore plus non-coking coal) are the dominant cost, and the swing in their prices is the single biggest driver of sponge iron margin. The process is energy-intensive: it consumes roughly 6 Gcal of fuel energy per tonne of DRI [3], and because coal is both the fuel and the reductant, the coal line and the iron-ore line together set the floor price. Indian primary-market sponge iron traded around 26,000-31,000 rupees per tonne in 2025, moving largely with iron ore and coal input costs [7].

Two structural factors keep the coal route competitive in India despite its lower metallization and higher carbon footprint than the gas route. First, captive power: the waste-heat and char streams described above offset a meaningful slice of the plant's electricity cost. Second, scale flexibility: a coal-based kiln runs economically at 30,000-150,000 tonnes per year [3], far smaller than a gas-based shaft-furnace module, which let India build out DRI capacity in small, distributed plants close to ore and coal rather than in a few mega-units.

The forward-looking economic pressure is carbon. Coal-based DRI is carbon-intensive, and the International Energy Agency's Iron and Steel Technology Roadmap projects that 44% of iron production will come from hydrogen-based processes by 2050, with hydrogen-DRI taking a large share, helped in India's case by low-cost solar electricity [8]. For the existing coal-based fleet that transition is a decade-plus horizon; in the near term, the economics reward yield (metallization and uptime), which is where reducing-atmosphere integrity and kiln availability, both functions of sealing, feed straight into the margin. If you are sizing a sealing retrofit against lost metallization and unplanned downtime on a specific kiln, the engineering-consulting team scopes that case the same way it does a cement false-air audit.