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Coal based process similar to FASTMET that uses iron oxide fines and pulverized coal to produce a scrap substitute. Mill scale and flue dust, inexpensive byproducts of steelmaking, can be mixed with the iron oxide fines. Inmetco, unlike other direct reduction products, is intended to be hot charged into an EAF, with attendant energy savings. The process includes three steps. First, iron oxide fines, pulverized coal and a binder are formed into pellets. Second, the pellets, two to three layers deep, are heated in a gas fired rotary hearth furnace for 15 20 minutes to produce sponge iron. Subsequently, the iron must be desulfurized. The coal in the pellets provides much of the energy required in the second phase.