Sponge iron arises from the direct reduction of iron ore and pellets, and because its structure is like a sponge, it is known as this and is the best alternative to scrap iron. Almost 50% of sponge iron in induction furnace can replace scrap iron. Production of this iron It is done in induction furnaces and this material is produced directly from the reduction of iron oxygen and has a grade between 85 to 95%.