DRI demand drives Midrex’s iron profits
For the steel industry, the mantra may as well be ’evolve or die'. That is at least how it appears as steel companies scramble to incorporate better, cleaner, and more efficient technologies into their processes.
Front and center in this movement is North Carolina-based Midrex Technologies, Inc. Midrex has found its niche by cornering the market in
iron ore direct reducing technology. According to Midrex, its technology has been responsible for more than 60% of the world's direct reduced iron (DRI) since 1987.
And if the rest of the world has anything to say about it, that figure could increase. The past half year has seen Midrex ink six large contracts. Each
iron ore-reducing furnace can retail for a cool $587 million. Industry analysts say that Midrex and fellow competitor
Nucor represent the domestic industry's future.
Direct reducing is a process whereby the oxygen is removed (reduced) by a reducing gas, typically a mixture of methane and recycled gas from the furnace. The result is DRI, a virgin iron source uniform in composition and virtually free of tramp elements. A primary advantage of DRI is that it can be combined with
scrap steel to reduce contaminates as well as increase furnace energy efficiency.
Business is so good that Midrex has doubled its workforce in the past year to 120. The company expects to hire an additional 30 employees by the end of the year.
The company has focused its efforts on helping its customers save time and money by making them more energy efficient. Midrex's technology allows customers to boost output while reducing the steps from getting the hot
iron ore to bringing it to the furnace for final steel
production.
Figures show that plants using Midrex's technology produced almost 35 million tons of steel in 2004, a 3 million ton increase over 2003. The new contracts are expected to add 9 million more tons of output.