A hearth furnace 10 for producing metallic iron material has a furnace housing 11 having a drying/preheat zone 12, a conversion zone 13, a fusion zone 14, and optionally a cooling zone 15, the conversion zone 13 is between the drying/preheat zone 12 and the fusion zone 14. A moving hearth 20 is positioned within the furnace housing 11. A hood or separation barrier 30 within at least a portion of the conversion zone 13, fusion zone 14 or both separates the fusion zone 14 into an upper region and a lower region with the lower region adjacent the hearth 20 and the upper region adjacent the lower region and spaced from the hearth 20. An injector introduces a gaseous reductant into the lower region adjacent the hearth 20. A combustion region may be formed above the hood or separation barrier.