Japanese trading house Itochu and UAE's largest steel producer Emirates Steel Arkan (ESA) will start producing 2.5mn t/yr of direct reduced iron (DRI) in Abu Dhabi after 2027.
Itochu and ESA initially planned to start DRI production in the second half of the April 2025-March 2026 fiscal year. But "the project was delayed", Itochu said without disclosing the reason. The DRI will be produced with iron ore from Brazilian steelmaker CSN's subsidiary, the Itochu representative added, but did not disclose the iron ore volume.
The firms will supply the produced DRI — a low-carbon steelmaking material — to Japanese producer JFE Steel, an Itochu representative told Argus today.
The volume of the DRI delivery to JFE was not disclosed, but it would be enough for JFE to produce around 50pc of total ferrous output at its new facility, according to Itochu. JFE plans to produce 2mn t/yr of ferrous products at its upcoming electric arc furnace plant from 2027, which will be located in western Japan's Kurashiki city.
Japan's state-owned export credit agency Nexi might insure the project, after the agency signed an initial agreement with Itochu and CSN on 7 May to co-operate on decarbonising the steel industry.
