Pellet Sponge iron is obtained from the direct reduction of iron pellets. The name of the product is due to its form of porous spherical (pellet) with a sponge-like appearance. Pellet Sponge Iron has a high grade of iron, which is more used today due to the shortage of iron scrap and its high price, which is causing environmental problems. The grade and amount of iron in sponge iron are between 78% to 82%. This high grade of iron makes it a good source for steel production. As mentioned, It is obtained from recycling natural or processed iron ore that has not reached the melting temperature. Pellet Sponge iron is a good substitute for iron scrap, so a high percentage of the raw material needed for steel melting can be produced from this product instead of scrap. One of the most important applications of sponge iron is in induction furnaces in which it is possible to be replaced by about 50% with scrap. In addition, it has made a major change in the continuous casting of the steel industry.