Sponge Iron is formed through the reduction of iron ore to metallic iron through reaction with carbon in the form of coal at approximate1100 degree Celsius.ŸMonnet Ispat & Energy Ltd. Is an ISO awarded company that manufactures Sponge Iron. Monnet Ispat & Energy Ltd. Also manufactures Ferro Alloys. Sponge Iron is also referred to as direct reduced iron, metalized iron, or hot briquetted iron. It is used in the iron and steel industry as a substitute for scrap in induction and electrical arc furnaces.