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A blast furnace is a shaft furnace in which a descending solid charge encounters rising hot gases. In iron extraction, the charge includes iron ore, coke and a flux such as limestone. The products include molten pig iron and slag, which separates from the metallic liquid.^[ref]

The gases supply both heat and a reducing environment. A simplified iron oxide reduction isHere carbon monoxide removes oxygen from the iron oxide and becomes carbon dioxide. The opposing flows allow rising gases to heat and react with incoming material before leaving the furnace: countercurrent flow helps recover energy within the process. The pig iron contains substantial carbon and requires further refining for most steelmaking.

Direct reduced iron is metallic iron produced by removing chemically bound oxygen from iron ore without melting the iron. Its porous structure gives rise to the name sponge iron. Gas-based processes can use hydrogen and carbon monoxide as reducing agents; the product can subsequently be melted during steelmaking.^[ref]

For the idealized hydrogen reaction $\mathrm{F}{\mathrm{e}}_2{\mathrm{O}}_3+3{\mathrm{H}}_2\to 2Fe+3{\mathrm{H}}_2\mathrm{O}$, the removed oxygen leaves in water. This reaction changes the direct chemical product relative to a carbon-based reduction, but the full environmental comparison also depends on how the hydrogen, process heat and electricity are supplied. Solid-state reduction and final steel melting remain distinct operations.

An electric arc furnace supplies heat through an electric arc between electrodes and the charge or molten bath. In steelmaking, it melts and refines material that can include recycled steel and direct reduced iron. It provides a different heating route from the internal oxidation heat central to basic oxygen steelmaking.^[ref]

The electrical input does not by itself determine the product's chemical composition. The charge, additives, slag and refining reactions must also be controlled. Similarly, the route's carbon dioxide emissions depend on how its electricity and metallic feed were produced; melting scrap and reducing fresh iron ore are different system boundaries.

Iron ore is naturally occurring material from which iron can be extracted under the relevant technical and economic conditions. Important iron-bearing minerals include hematite, $\mathrm{F}{\mathrm{e}}_2{\mathrm{O}}_3$, and magnetite, $\mathrm{F}{\mathrm{e}}_3{\mathrm{O}}_4$. Real ore also contains other minerals, so its composition differs from that of a pure iron oxide.^[ref]

Using approximate atomic masses, pure hematite contains $2(55.85)/(2(55.85)+3(16.00))\approx 69.9\%$ iron by mass. This is a mineral-composition calculation, not the grade of every ore deposit. Beneficiation, transport and removal of oxygen and unwanted constituents all influence whether a deposit is a useful feed for iron extraction.