by The global electrical steel industry is witnessing significant growth owing to increasing investments in infrastructure development projects worldwide. Electrical steel, also known as silicon steel, is widely used in power generation and power transmission applications due to its high magnetic permeability and low power losses at a high frequency. It finds extensive usage in electric motors and transformers adopted in utility infrastructure, renewable energy plants, residential & commercial complexes, and transportation facilities such as railways. The rising capital expenditure on building roads, airports, power grids, and expanding urban cities in developing countries is driving the demand for electrical steel.
The global Electrical Steel Market is estimated to be valued at US$ 43.97 Mn in 2024 and is expected to exhibit a CAGR of 8.6% over the forecast period 2024-2031, as highlighted in a new report published by Coherent Market Insights.
Market key trends:
Non-grain oriented electrical steel is expected to witness substantial growth over the forecast period. This type of steel has high magnetic properties and is extensively used in manufacturing rotating machines. Additionally, increasing investments in wind energy projects are augmenting the demand for non-grain oriented steel as it is used in generators of wind turbines. According to data by the Global Wind Energy Council, the global cumulative installed capacity of wind power reached 836 GW in 2021 and is anticipated to reach over 1,800 GW by 2030. This rapid growth of the wind energy industry is projected to propel the demand for non-grain oriented electrical steel.
Porter’s Analysis
Threat of new entrants: The Global Electrical Steel Market Size requires high capital investment for setting up manufacturing facilities and large R&D budgets to develop new products. This poses significant barriers for new players.
Bargaining power of buyers: The buyers in this market include large automotive and energy equipment manufacturers who have significant bargaining power due to the fragmented nature of suppliers.
Bargaining power of suppliers: The market has a concentrated supply base with a few large players dominating global supply. This gives suppliers significant bargaining power over buyers.
Threat of new substitutes: There are limited substitutes available for electrical steel as it offers unique soft magnetic properties preferred in transformers and motors.
Competitive rivalry: Being a global industry, competition is intense among the top players to continuously develop improved grades and garner greater market share.
Key Takeaways
The global electrical steel market is expected to witness high growth over the forecast period.
Regional analysis: Asia Pacific accounts for the largest share of the global market. China is the leading producer and consumer of electrical steel globally. Other major markets include Japan and South Korea. The demand is increasing steadily in India supported by the country’s rapid industrialization. Europe is another major region for electrical steel consumption driven by well-established automotive and energy industries.
Key players: Key players operating in the electrical steel market include Yara International ASA, The Mosaic Company, Nutrien Ltd., and BASF SE. These companies are focusing on expanding production capacities and introducing new micro-alloyed grades to improve efficiency in motor and transformer applications.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
