The growing demand for clean technologies is pushing the steel industry for alternatives to produce pig iron. One option is the use of biomass in substitution to mineral coke; however to spread this technology, the efficiency of the full process should be improved. On the case of mini-blast furnace for pig iron production, the volatile matters produced at charcoal plant are usually lost. This paper seeks to take advantage of these volatile matters by using it directly in production of iron-carbon nuggets. The biomass is sawdust of different types of wood, as it can be obtained in the sawmills. The raw material - sawdust was homogenized, dried and analyzed. A self-reducing mixture of low grade iron ore (43.5%) and sawdust (56.5%) was prepared and processed at 1773 K for 15 minutes in electric rotary kiln. Its atmosphere was enriched with argon (1NL/min.). The reaction fraction was measured, achieving 99.2% of reduction. The final product was carefully disaggregated to avoid any grinding of metallic phase. The particle size distribution of the iron-carbon nuggets was measured, showing that 50.5% of the product was larger than 7.93 mm, and 97.2% bigger than 0.84 mm. These results can open the way for the direct use of biomass as reducer of iron ore and a more energy efficient process can be born.