Hot Briquetted Iron (HBI) Market to Reach US$ 8.1 Billion by 2035 Driven by Sustainable Steel Production and Rising Demand for High-Quality Raw Materials

The global hot briquetted iron (HBI) market is experiencing steady growth, supported by increasing demand for cleaner steelmaking processes and high-quality raw materials. The market was valued at US$ 4.4 Bn in 2024 and is estimated to grow at a CAGR of 5.8% from 2025 to 2035, reaching approximately US$ 8.1 Bn by the end of 2035. The shift toward low-carbon steel production and growing use of electric arc furnaces (EAF) are significantly contributing to market expansion.

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Market Overview

Hot briquetted iron (HBI) is a compacted form of direct reduced iron (DRI), produced by compressing iron ore at high temperatures into dense briquettes. HBI is widely used as a premium feedstock in steelmaking, particularly in electric arc furnaces, due to its high iron content and low impurities. It offers advantages such as improved handling, reduced oxidation, and consistent quality, making it a preferred alternative to scrap metal in steel production.

Key Drivers

The growth of the HBI market is driven by several important factors:

1. Increasing demand for sustainable and low-carbon steel production
2. Growing adoption of electric arc furnace (EAF) technology
3. Rising need for high-quality raw materials in steel manufacturing
4. Fluctuations in scrap steel availability and quality
5. Expansion of infrastructure and construction activities

Shift Toward Sustainable Steelmaking

The global steel industry is increasingly focusing on reducing carbon emissions and improving environmental sustainability. HBI plays a crucial role in this transition by enabling cleaner steel production compared to traditional blast furnace methods. Its use in EAFs significantly reduces greenhouse gas emissions, aligning with global climate goals.

Growing Adoption of Electric Arc Furnaces

The adoption of electric arc furnaces is increasing due to their flexibility, efficiency, and lower environmental impact. HBI serves as an ideal feedstock for EAFs, providing consistent quality and enhancing steel properties. This trend is driving demand for HBI across major steel-producing regions.

Rising Demand for High-Quality Steel

Industries such as automotive, construction, and manufacturing require high-quality steel with minimal impurities. HBI offers superior metallurgical properties, improving the strength and durability of steel products. This is boosting its adoption in premium steel production applications.

Volatility in Scrap Steel Supply

The availability and quality of scrap steel can be inconsistent, leading to challenges in steel production. HBI provides a reliable and high-quality alternative, ensuring stable production processes and consistent output quality.

Infrastructure and Industrial Growth

Increasing investments in infrastructure development and industrialization are driving demand for steel globally. This, in turn, is boosting the demand for HBI as a key raw material in steel manufacturing.

Hot Briquetted Iron (HBI) Market Development

• On April 2025 saw Primetals Technologies, Rio Tinto, Mitsubishi, and Voestalpine enter into a cooperation to construct an industrial‑scale H₂‑DRI/HBI pilot plant at the Linz premises of Voestalpine. The new plant will manufacture ~3 t/hr of hot metal through hydrogen‑based reduction of fines with no pelletizing, with near-zero CO₂ emissions. Startup is planned for mid‑2027. Rio Tinto will provide 70 % of iron ore and technical assistance.
• On January 13, 2023, Metalloinvest launched upgraded direct reduction facilities in Lebedinsky GOK's No. 3 hot briquetted iron production facility (HBI-3), thereby boosting yearly production capacity by 3% to over 2 million tons of briquettes.
• In April 2022, ArcelorMittal announced that it had signed an agreement to acquire 80% of controlling stake in voestalpine's new-generation Corpus Christi, Texas-based hot briquetted iron (HBI) plant. Voestalpine will retain the rest of the 20% interest under the agreement. The Corpus Christi facility, which boasts a world-leading capacity for production, is valued at approximately US$ 1 Bn under the agreement.

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Regional Analysis

The HBI market shows strong regional dynamics:

1. Middle East & Africa dominates the market due to abundant natural gas resources and growing DRI production capacity
2. Europe is witnessing significant growth driven by decarbonization initiatives and adoption of EAF technology
3. North America holds a substantial share supported by increasing investments in steel manufacturing and infrastructure
4. Asia Pacific is emerging as a key market due to rising steel demand and industrial expansion

Key Companies

The market is moderately consolidated, with key players focusing on expanding production capacity and strategic partnerships. Leading companies include Metalloinvest, Nucor Corporation, ArcelorMittal, Cleveland-Cliffs Inc., Qatar Steel, Emirates Steel Arkan, Kobe Steel, Ltd., Liberty Steel Group, Tosyali Holding, and JSW Steel Ltd.

• Jindal Shadeed Iron & Steel LLC
• METALLOINVEST MC LLC
• Voestalpine Rohstoffbeschaffungs GmbH
• QATAR STEEL
• Abtin Steel Technology Co.
• Cleveland-Cliffs Inc.
• Orinoco Iron
• KOBE STEEL, LTD
• Lion Group
• Midrex Technologies
• Others

Market Challenges

Despite steady growth, the market faces challenges such as high capital investment for HBI production facilities and dependency on natural gas availability. Additionally, fluctuations in raw material prices and geopolitical factors may impact supply chains and market dynamics.

Future Outlook

The hot briquetted iron market is expected to grow steadily over the forecast period, driven by the global shift toward sustainable steel production and increasing adoption of EAF technology. Technological advancements and capacity expansions will further support market growth. As the steel industry continues to prioritize efficiency and environmental sustainability, HBI will play a crucial role in shaping the future of steel manufacturing.

Frequently Asked Questions (FAQs)

1. What is the projected size of the HBI market by 2035?
2. The market is expected to reach approximately US$ 8.1 Bn by the end of 2035.
3. What is the expected growth rate of the market?
4. The market is projected to grow at a CAGR of 5.8% from 2025 to 2035.
5. What are the key drivers of market growth?
6. Key drivers include sustainable steel production, adoption of EAF technology, and demand for high-quality raw materials.
7. Which region dominates the market?
8. Middle East & Africa currently leads the market due to strong production capacity and resource availability.
9. What is hot briquetted iron (HBI) used for?
10. HBI is used as a high-quality raw material in steel production, particularly in electric arc furnaces.

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