India’s sponge iron production increased by 8% from 34.7 million tons in FY2018-19 to 51.5 million tons in FY2023-24. Projections indicate that this figure could exceed 75 million tons by 2030.
In FY2023-24, small and medium-sized enterprises dominated the domestic sponge iron market, contributing 71% of the production, while large companies accounted for the remaining 29%. Over the last five years, the long products sector has increased its share of India's total steel production from 52% to 55%, reflecting the growing demand for long steel products, which are widely used in construction and infrastructure, driving the growth in sponge iron production.
Experts suggest that flat product production is likely to increase in the next three years as large companies increase their blast furnace capacity. Despite this change, long products are expected to remain dominant in terms of total production volume.
India’s iron ore and coal are the primary raw materials for sponge iron production. While the country is self-sufficient in iron ore, it relies on imports for 30-40% of its steam coal. India produced 277 million tons of iron ore in the fiscal year 2023-24, and this figure is expected to increase by 7-9% in the next five years. Additionally, pellet production is projected to increase in response to rising steel industry demand and expanding capacity.
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