by The electrical steel market comprises of different ferromagnetic steel grades having low hysteresis and eddy current losses which make them suitable for transformer cores and motor cores. They offer low core loss and high permeability for efficiently conducting magnetic fluxes. The growing demand for electric vehicles around the world has fueled the consumption of electrical steel for motors and transformers. Major manufacturers such as Yara International, Mosaic, and Nutrien are expanding their production capacities to meet the escalating requirements.
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 to 2030.
Key Takeaways
Key players operating in the Electrical Steel are Yara International ASA, The Mosaic Company, Nutrien Ltd., BASF SE, Agrium Inc. (acquired by Nutrien). These companies are investing heavily in R&D to develop advanced grades with improved properties. For instance, Yara International launched a new micro-grain oriented electrical steel in 2021 suitable for high-efficiency motors.
The growing demand for electric vehicles globally is driving the consumption of electrical steel. Major automakers are focusing on electrification of their model lineups to comply with stringent emission norms. This is positively impacting the off-take from the electrical steel market.
The rising renewable energy installations across both on-grid and off-grid applications are augmenting the electrical steel demand. Key players are expanding their international presence to leverage growth opportunities in developing nations undergoing rapid electrification.
Market key trends
One of the key trends in the Electrical Steel Market Demand is the shift towards non-grain oriented steel grades. Earlier, grain oriented electrical steel dominated transformer applications owing to its better magnetic properties. However, non-grain oriented grades are gaining popularity due to their ease of manufacturing and isotropic properties, which reduce core losses. Major manufacturers have enhanced the quality of non-grain oriented steel to promote its usage in transformers.
Porter’s Analysis
Threat of new entrants: Low level of capital required but high economies of scale would make entry difficult.
Bargaining power of buyers: Buyers have moderate power due to presence of major competitors in this market.
Bargaining power of suppliers: Suppliers have low to moderate power as there are several global and domestic suppliers providing basic raw materials.
Threat of new substitutes: Low threat of substitutes as electrical steel has no close substitute in power transformer cores and motors.
Competitive rivalry: Intense competition due to presence of few large players dominating the market.
Geographical Regions
The market for electrical steel is highly concentrated in Asia Pacific region, specifically in China which accounts for around 40-45% of global demand due to presence of domestic electrical equipment manufacturers.
The fastest growing region for electrical steel market is expected to be Middle East and Africa region during forecast period owing to rapid industrialization and infrastructure development activities in countries like Saudi Arabia, UAE, Egypt etc. which will boost demand for electrical equipment using electrical steel.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
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