The invention discloses a grate-rotary kiln spraying biomass fuel as well as a preparation method and application thereof. The preparation method comprises the following steps: sufficiently mixing biomass powder with iron-containing ore powder, and performing heating carbonization in a mixed atmosphere of a protective gas and vapor, so as to obtain a biomass fuel of which the volatile content is 10-20%, the combustion heat value is 20-27MJ/kg, the porosity is 40-60% and the specific surface area is 40-70m<2>/g. The biomass fuel can be adopted to replace a part of common injection fuel coal powder and used as a rotary kiln tail injection fuel, the fuel cost can be lowered, and emission of SOx and NOx can be efficiently reduced from sources.