About Tamahagane
Tamahagane is a high-quality steel with very few impurities. It is crafted by blowing iron sand (satetsu) mined in the mountains of Shimane Prefecture with charcoal in an ancient furnace called a "tatara." It is the raw material for Japanese swords, said to be the finest in the world.
A "tatara" is a square clay furnace built with a bellows blowing air from below. Charcoal is added to light a fire, and once the temperature is sufficiently raised, charcoal is added, followed by a sprinkling of iron sand. The heating process continues, with charcoal and more iron sand added. The iron sand used in this process is called "masa," and is of a high quality comparable to iron ore mined in Sweden. The heated iron sand loses oxygen in the furnace and becomes pure iron. It then quickly absorbs carbon and transforms into pig iron. Pig iron has a low melting point, falling like droplets at around 1350°C, accumulating at the bottom of the furnace. When the wind hits the surface, the carbon in the pig iron burns, turning it into steel.
References:
"Knife Knowledge" by Kosuke Iwasaki