Iraq is planning to build a sponge iron plant to support its steel industry after it plummeted below its half output capacity, the Industry Minister has said.

The plant in the Southern Basra city will produce nearly one million tonnes of sponge steel per year and is the latest in major industrial projects to be approved by the government, Khalid Najm told local reporters at the week end.

“We will sign a contract with a company next month for the sponge iron project, which is intended to bolster Iraq’s steel sector,” he said.

Director of Iraq’s Steel Company Abbas Hayal said the project is needed after Iraq’s steel production plunged to around 2 million tonnes from more than 7 million tonnes per year due to sponge iron shortages.

Sponge iron, also known as direct reduced iron (DRI), is a raw material used in the steel industry to make iron and steel products.

(Writing by Nadim Kawach; Editing by Anoop Menon)

(anoop.menon@lseg.com)

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