Ban on Steel Scrap Imports Steers Direct Reduced Iron (DRI) Demand; Global Market Value Pegged at US$ 17 Bn Through 2030

May 28,2020 | Chemicals & Materials

Direct reduced iron (DRI) has recently emerged as a quality supplement, in place of scrap steel, among steel making companies. Increasing steel production capacities, heightened awareness about CO₂ emission control among steel producers, and accelerating demand for high-quality steel from end users continue to drive DRI consumption in global market. According to a recent report published by Future Market Insights (FMI), the global DRI market is projected to reach revenues worth US$ 17 Bn by 2030 end, with growth projected at an impressive CAGR between 2020 and 2030.

While increasing steel production capacities in China, India and some Middle Eastern countries account for the amplifying DRI demand, the COVID-19 pandemic has led to disruptions across end-use industries, thereby impeding demand for steel. Ban on steel scrap imports are significantly steering sales of DRI amid the global coronavirus outbreak. Surplus supply, and low demand and high storage volumes will result in considerably falling steel production in near term, ultimately affecting the demand for DRI.

Manufacturers based in the Middle East are aggressively expanding their DRI production capacities in response to the growing steel demand within region. This would help the regional industry reduce its dependence on imports and emerge as self-reliant in terms of raw material procurement.

Key Takeaways from DRI Market Study

For More Detailed Insights on Direct Reduced Iron (DRI) Market

  • Gas-based production process to remain as the go-to option among manufacturers, especially in North America, Europe and Middle East, due to lower natural gas prices
  • Coal-based production is dominated by India, which accounts for almost 80% of the DRI produced through coal-based process
  • Pellets are the most preferred among DRI form type, as they are easy to transport, have better reactivity and are cost effective than lumps
  • Over the recent past, DRI imports have been witnessing a steady rise despite facing stern competition from hot briquetted iron (HBI); the latter has low reactivity and is subject to lower transportation costs
  • Vertical integration strategies adopted by steel manufacturers to produce DRI at their own facilities would remain an impending trend in the near future

DRI Market: Key Participant Insights

While DRI will not replace scrap steel as the primary raw material for steel production, it is projected to be utilized as a key ingredient and in higher proportions. In addition, the growing demand for high quality steel products is further expected to drive DRI demand. Most of the leading tier-1 manufacturers in the DRI market, like ArcelorMittal, SIDOR, Jindal Steel, Mobarakeh Steel and Nucor, use most of their production for captive consumption and the rest for exports to major steel manufacturers around the world. Capacity expansions are also one of the primary focus of the globally leading manufacturers to stay ahead of the competition.

Know More About FMI’s DRI Market Report

A new market study by Future Market Insights (FMI) on the global Direct Reduced Iron (DRI) market provides deep dive analysis into DRI production and consumption trends on a global level as well as country level. The study gives in-depth analysis into market trends for DRI through four different segments- form, application, production process and region. The DRI research report also offers key insights into DRI cost structure analysis, BEP analysis, DRI transportation costs, DRI production costs, profit per ton analysis, export hotspots and trade routes, import/export trends and probable list of customers.

For additional insights on how the market growth will unfold over the period of projection, write to the analyst at [email protected]

About Chemicals & Materials division of FMI

The Chemicals & Materials division at FMI offers distinct and pin-point analysis about the chemicals & materials industry. Coverage of the chemicals market extends from commodity, bulk, specialty and petrochemicals to advanced materials, composites, and nanotechnology. The team also puts special emphasis on ‘green alternatives’, recycling and renewable technology developments, and supply-demand trade assessment. Our research studies are widely referred by chemical manufacturers, research institutions, channel partners, and government bodies for developing – ‘The Way Forward’.

About Future Market Insights (FMI)

Future Market Insights (FMI) is a leading provider of market intelligence and consulting services, serving clients in over 150 countries. FMI is headquartered in London, the global financial capital, and has delivery centres in the U.S. and India. FMI's latest market research reports and industry analysis help businesses navigate challenges and take critical decisions with confidence and clarity amidst breakneck competition. Our customized and syndicated market research reports deliver actionable insights that drive sustainable growth. A team of expert-led analysts at FMI continuously track emerging trends and events in a broad range of industries to ensure that our clients prepare for the evolving needs of their consumers.

Media Contact

Rahul Pandita

Rahul Pandita

Head – Corporate Communications

Abhishek Budholiya

Abhishek Budholiya

Head – Digital Marketing