Ispat to enter sponge iron, DRI marts

Ispat Industries has decided to enter the sponge iron/ directly reduced iron (DRI) market from June, so far being captively consumed.

Ispat has a DRI plant with 1.6 million tonne capacity, which happens to be one of the world's largest mega module plant, said company sources.

With international scrap prices seeing a significant fall in last two months or so, Ispat has decided to use more of scrap at its Dolvi operations.

The decision to use a mix of hot metal / pig iron, scrap and sponge iron / DRI, instead of a hot metal and DRI combination, would bring down the company's cost of production.

Sponge iron prices peaked in April to Rs 14,300 per tonne and then came down to Rs 11,500 per tonne in the second week of May. At present, sponge iron prices were ruling at Rs 12,300 per tonne.

Ispat currently has a finished steel making capacity of 2.4 million tonne for which its metallics is fed predominantly through a mix of (DRI) / sponge iron and hot metal / pig iron from its 2 million tonne blast furnace. Ispat is expanding its steel making capacity to over 3 million tonnes within the next few months.

Ispat enjoys the option to go for feed mix combination of sponge iron, hot metal and scrap for feeding its twin shell electric arc furnace.