“...cheap iron powder burns readily at high temperatures...”
What are you burning to get the temperature that high?
The iron powder. That is the fuel source. When you ignite it, it burns at a high temperature.
Oxidization is what creates the temperature. They pulverize the iron into powder and burn it. You are left with a pile of iron oxide that is then turned back into iron, through electricity. Then repulverized and then reburned.
You can do this basically endlessly, with only a minimal loss over time.