Sponge Iron Procurement: Metallisation, Fines and Landed Cost
Why an 82% metallisation lot at a lower rate can cost more than an 86% lot, and how to structure DRI contracts around yield rather than headline price.
Metallisation is the price
Sponge iron is bought for the metallic iron it delivers into the furnace. A four-point metallisation difference changes yield enough to swamp a ₹500 per tonne rate advantage. Always convert quotes to cost per tonne of liquid metal before comparing.
Lump-to-fines ratio
Fines behave differently in charging and carry a different price. Insist that the lump/fines split is declared per lot and verified at delivery, otherwise the mix silently shifts the economics against the buyer.
Freight from the kiln belt
Most Indian DRI capacity sits in the Raipur–Bhilai and Rourkela belts. Buyers in the north and south should model road freight and transit time into landed cost, and track vehicles in real time so the charge plan does not stall waiting on a truck.