A method of obtaining pig iron, consisting of charging a retort with a mixture of iron ore, coal, and enough water to form a paste; and injecting compressed air at 2 to 4.2 kg/cm₂pressure and at 815 to 930 degrees C to burn the coal. In a few minutes the entire mineral charge is heated to 980 to 1,095 degrees C, which is the optimum range for hydrogen reduction; then hydrogen is injected at a temperature of 815 to 923 degrees C at 2 to 8 kg/cm₂pressure so that it penetrates the entire mass and reacts with the iron oxide to produce steam and metallic iron. About 50% of the injected hydrogen reacts with the ore to produce sponge iron. Sulfur is oxidized by the hot air and is eliminated by the hydrogen.