By Guy Saxton — For CNN Infra

14/07/26

The global energy transition is often associated with the expansion of renewable energy sources, electric vehicles, and infrastructure modernization. While this view is correct, it overlooks a critical point: decarbonizing the global economy will require more steel, more cement, more concrete, and therefore a new way of producing the materials that underpin development.

Demand for steel, cement, and concrete is expected to increase by more than one-third by 2050, when the global population is projected to reach 9.7 billion people, with approximately 70% living in urban areas.

To accommodate this urban expansion, the equivalent of a new New York City will need to be built every month for the next 40 years. Even technologies that symbolize the transition, such as wind turbines, depend on large volumes of steel and concrete.

In the case of steel, the challenge is particularly significant. The iron and steel value chain accounts for approximately 9% of global emissions, which helps explain why its transformation has become a central focus of decarbonization strategies. In this context, green iron—particularly HBI (Hot Briquetted Iron)—is gaining importance. As an intermediate product between iron ore and steel, it helps enable lower-emission steelmaking routes and greater industrial efficiency.

This shift is already beginning to gain scale. More than 300 million tonnes per annum (Mtpa) of electric arc furnace (EAF) capacity are currently planned worldwide. Green HBI is a critical feedstock in this movement, supporting the transition from coal-based production models to cleaner steelmaking.

At the same time, mechanisms such as the European Carbon Border Adjustment Mechanism (CBAM) and initiatives like Japan’s GX (Green Transformation) are beginning to assign economic value to emissions reductions, creating price support for materials with a lower carbon footprint.

Some still view green iron solely through the lens of its higher cost compared to conventional production routes. Yes, it is a more expensive solution. But the discussion can no longer be limited to the immediate price per tonne. International markets are beginning to place greater value on materials with a lower carbon footprint, stronger traceability, and greater regulatory compliance. In many cases, the overall impact is smaller than it may appear. A study by the International Council on Clean Transportation found that using lower-emission steel would add only about 1% to the average price of a new vehicle.

From a technological standpoint, the debate must also be approached pragmatically. The decarbonization of the steel industry will not be enabled by a single solution, nor will it happen overnight. Initial production routes using natural gas and carbon capture and storage (CCS) can reduce emissions from green HBI production by up to 95%. At a later stage, with the adoption of green hydrogen, this reduction can reach as much as 99%. This demonstrates that a concrete transition pathway already exists, with progressively cleaner solutions and the potential for large-scale deployment.

This trend creates a significant opportunity for Brazil. The country possesses high-quality iron ore reserves, including abundant friable itabirite deposits, which enable the removal of impurities at a competitive cost, a power matrix with a strong share of renewable energy, and favorable conditions to add greater value to its mineral production.

Only about 3% of the world’s iron ore is of this type and therefore suitable for this process. Rather than limiting itself to exporting raw materials, Brazil has the opportunity to move into more advanced stages of mineral beneficiation and industrial processing. In a global environment increasingly shaped by carbon considerations, green iron is no longer merely an environmental choice. It has become an economic, industrial, and geopolitical decision.

* Guy Saxton is President of Brazil Iron.