In 2013, the world's direct reduction iron (DRI) output increased by two million tons or 2.8 percent year on year to a record 75.2 million tons, even though two key producing countries, India and Venezuela, saw significant declines in production, according to data compiled by Midrex Technologies, Inc. and audited by World Steel Dynamics.
In 2013, the DRI output of the Middle East and North Africa (MENA) region increased by five million tons over 2012 to 32.4 million tons, which was 55 percent of the world's total DRI production. In the given year, the Kingdom of Bahrain entered the group of DRI producing nations, while Iran's DRI output increased by nearly three million tons. Meanwhile, Saudi Arabia and the United Arab Emirates (UAE) set new records for national DRI production, Oman increased production slightly for the year and Libya increased its output tonnage as its industry continues to rebuild after the civil war.
Outside of the MENA region, Russia had a new record output, producing 5.3 million tons of DRI, while India's DRI output fell sharply to 17.8 million tons, down from 23.4 million tons recorded in 2010. The main reasons for the decline were the same difficulties that have been seen in the past few years, which included lower availability of domestic iron ore due to regulations, licensing related to environmental requirements, and extremely high prices of natural gas, which is one of the resources for production. Meanwhile, in 2013 Venezuela's DRI production decreased by 40 percent from 2012, due to a shortage of iron oxide pellets to feed the DR plants, but the underlying reason is lack of funds for maintenance throughout the supply chain; in mining, transportation, materials handling, pelletizing, iron-making and infrastructure.
Approximately 16 million tons per year of DRI capacity are currently under construction worldwide. According to Midrex forecasts, the plants currently under construction will come on stream over the next three years and global DRI production will be increase five million tons per year and more over the next decade. Mindrex expects that DRI production in the US alone will reach at least 10 million tons per year by 2020. Nearly half of this increased production capacity has already been built or is in the construction phase. The US will most likely see two to three more facilities, representing 5-6 million tons of capacity being built in North America by end of this decade.
