The Middle East and North Africa (MENA) region is well-positioned to lead the global shift toward green iron and steel, leveraging its competitive advantages in renewables, green hydrogen, and steel production, according to the Institute for Energy Economics and Financial Analysis (IEEFA).
With one of the world’s fastest-growing steel industries, MENA is already a key hub for gas-based direct reduced iron (DRI) production, a lower-emission alternative to traditional coal-based steelmaking. The region’s DRI process, powered by electric arc furnaces, offers a clear path to further decarbonization by transitioning from fossil gas to green hydrogen.
Recent developments have reinforced MENA’s leadership in the sector. On February 25, Libya announced plans to establish a DRI complex in Benghazi to supply the Mediterranean market. This follows Brazilian mining giant Vale’s expansion of its iron ore concentrate and agglomerate capacity in the region, supporting the growth of DRI production.
IEEFA’s research highlights MENA’s increasing role in global steel decarbonization. The region accounted for 45pct of global DRI production in 2023, an 11pct rise from 2021. Unlike other regions facing shortages of high-grade iron ore for DRI-EAF steelmaking, MENA benefits from reliable access to iron ore concentrate and pellets, further strengthened by Vale’s expansion plans.
Additionally, MENA is one of the fastest-growing renewable energy markets, boasting some of the world’s lowest-cost solar and wind power. This advantage is fueling its emergence as a leading green hydrogen hub, with hydrogen-based steel production already underway.
MENA’s robust infrastructure and increasing investment in low-emission technologies position it as a key player in the evolving green steel market. By acting now, the region can capitalize on this opportunity to supply green iron and steel to major markets in Europe and Asia.
