Last few years saw the emergence of mini sponge iron industry in India. Many small sponge iron units came up in the states like Chattisgarh, Orissa, Karnataka (Hospet), Jharkhand etc. All these regions have an abundant iron ore reserves which is the major input for sponge iron industry. Further, last few years also saw the scarcity coupled with exponential price rise in met coke and coking coal sector. This gave rise to thinking about alternative steel making route. Sponge iron production process does not require coking coal and uses non coking coal which is abundantly available in India. Sponge iron units produce a lot of flue gases and would pollute the atmosphere to a great extent. Instead of letting these gases go in the atmosphere, many units started using their heat to turn the turbine and eventually produce electricity. This power could be used to run the plant itself. Today, most of the states do not allow sponge iron units unless they have the 'Co-generation' module.

    The natural forward integration to such a sponge iron unit is to install an induction or electric arc furnace and produce billets by continuous casting. Many such units which start with iron ore and finally produce billets have emerged in the above mentioned areas. These can be called as 'Integrated Mini Steel Complexes'. Having a complete supply chain under one roof gives a value addition from Rs.2000 (price of iron ore) to Rs. 16,000 (price of MS billet). This also ensures long term viability of the unit and it can withstand the price and demand fluctuations of the market.