When a piece of steel is needed, say for a sword, the liquid form of pig iron is forged in fire. The fire is used to mold and shape the metal. It also helps to remove the impurities from the raw iron. Then alloys are added. The grade of steel created is determined by what kind alloying material is added.
That is the same thing that God does with us. He uses our trials and circumstances (the fire) to mold and shape us. They are used to strip away the impurities, the things that are not of Him. He forges us in the fire until there is nothing but us stripped down, raw before Him. As we go through the trials and tribulations, we learn valuable lessons and build character (alloying material). As those things are added to us we become more like Him, we grow in Him (grade of steel). As we become more purified and seek those things that are spiritual and not worldly, our strength and grade increases.
“This third I will put into the fire; I will refine them like silver and test them like gold. They will call on my name and I will answer them; I will say, ‘They are my people,’ and they will say, ‘The LORD is our God.'” Zechariah 13:9