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The importance of low- and medium-grade ores

The majority of the global iron ore supply consists of low- and medium-grade ores. The mines in the Pilbara region of Western Australia contribute 900 million tonnes or over half of all seaborne iron ore that the global steel industry consumes annually. Most of this is shipped to China, which produces more than half of the world’s steel.

The sheer scale of the contribution of the Pilbara to global steel consumption means the development of one or a suite of successful solutions for decarbonising steelmaking using Pilbara iron ores has the potential for a significant impact on lowering emissions from steelmaking.

Decarbonisation pathways for low- and medium-grade ores

At Rio Tinto, we have been partnering with industry to develop low-carbon steelmaking pathways for Pilbara iron ores. We believe our most promising innovations have the potential to set the stage for commercial viability of low-carbon steelmaking. Our ambition is to support our customers to achieve their net zero targets by 2050; this is one decade earlier than we would expect based on their current net zero commitments and those made by the governments in those countries where our customers operate.

One of our most advanced innovations is BioIron™. BioIron™ is a world-first technology that uses raw, sustainable biomass and microwave energy instead of coal to convert Pilbara ores into iron. When used with fast-growing biomass and combined with renewable energy, BioIron™ has the potential to reduce CO₂ emissions by up to 95% compared with the current blast furnace method.

Following successful trials of the process in a small-scale pilot plant in Germany, we have committed A$215 million to develop a research and development facility in Western Australia. Ten times bigger than its predecessor in Germany, the facility will enable us to test the innovative steelmaking process at a semi-industrial scale, providing us with the required data to assess further scaling of the technology to a larger demonstration plant.

Another important future pathway for Pilbara iron ores involves the use of electric smelting furnace (ESF) technology, which can remove impurities from iron made with low- to medium-grade iron ores. We have been working with Baowu to develop direct reduced iron - electric smelting furnace (DRI-ESF)² technology in China for more than a year. We are also collaborating with BlueScope and BHP to test ironmaking technology without the need for traditional, often emissions-heavy, blast furnaces and investigating the development of Australia's largest ironmaking ESF pilot plant. The Kwinana Industrial Area in Western Australia, has been selected as the location for the pilot facility as part of a pre-feasibility study. The joint efforts of Australia’s leading iron ore producers with the country’s biggest steelmaker combines industry-leading expertise to create a potential step-change in the decarbonisation of global steelmaking. 

At the same time, we are assessing the beneficiation and upgradeability potential of Pilbara iron ores, as well as pelletisation of these ores, for use in future low-carbon steelmaking technologies. In addition, we are testing the feasibility of using Pilbara ores in fluidised bed technology, which does not rely on pelletisation of iron ore and thus can significantly reduce the capital cost associated with decarbonising the industry.

While we are progressing our investment in new innovations and technologies, most of the world’s steel today is still being produced using the blast furnace, which relies on coal and emits between 1.8 and 2.2 metric tonnes of CO₂ per ton of steel. To bridge the period between now and when we can fully commercialise different solutions, we are focusing on applying best practices and optimisation strategies to help support customers to reduce blast furnace carbon emissions by 20–30% by 2035. For example, we are working with customers both on burden optimisation – improving systems to allow a higher usage of lump in the blast furnace – and on slag utilisation – improving energy conservation and waste recycling.

Decarbonisation of the steel value chain is complex. While full transformation will take decades, we must not delay taking the first steps. Pragmatic and urgent actions today are essential to pave the way for a lower carbon future. The continued optimisation of the blast furnace until new technologies are proven at commercial scale is an important and pragmatic first step.

Beyond technology

No single entity possesses all the necessary resources or capabilities to tackle this challenge alone, and breakthroughs in decarbonisation will not come from isolated efforts. These breakthroughs will only emerge when industrial leaders combine their efforts and nations work together for the common good.

The development of low-carbon technologies for Pilbara iron ores is showing tremendous promise, with our collaborations across the steel value chain critical to achieving our goals. In addition to industry partners, we are also working with governments to fast-track our decarbonisation projects around the world.

In Australia, there is an economic imperative to unlock low-carbon solutions, with iron ore delivering 33% of Australia’s export income ($138 billion in 2023–24)³.

The coming decades will be a period of great transformation for the steelmaking value chain. The world needs low-carbon steel to reach net zero.

As a leading iron ore producer, we understand the role we have to play in finding better ways™ to decarbonise the steel value chain and to ensure that Pilbara iron ores are well-positioned for low-carbon steel.