Electrical Steel Market

2021 Analysis and Review: Electrical Steel Market by Product Type – Grain-Oriented and Non-Grain Oriented for 2021 – 2031

Electrical Steel Market Snapshot

The electrical steel market is expected to register year-on-year growth at 5.3% in 2021, with the overall valuation forecast to reach US$ 37.5 Bn. A Future Market Insights (FMI) analysis estimates electrical steel sales to increase at 6.5% CAGR between 2021 and 2031. According to the study, the overall electrical steel market is expected to reach US$ 70.5 Bn by 2031.

While   non-grain oriented electrical steel is expected to remain dominant, grain oriented electrical steel demand will surge at a higher pace, exhibiting growth at 5.7% CAGR in 2021.

Key Points Covered in Electrical Steel Market Study

  • Market estimates and forecast 2016-2031
  • Key drivers and restraints impacting market growth
  • Segment-wise, Country-wise, and Region-wise Analysis
  • Competition Mapping and Benchmarking
  • Brand share and Market Share Analysis
  • Key Product Innovations and Regulatory Climate
  • COVID-19 Impact on Electrical Steel Market and How to Navigate
  • Recommendation on Key Winning Strategies

2016-2020 Electrical Steel Market Outlook Compared to 2021-2031 Forecast

Revenue generated in the energy segment of the electrical steel market grew at a strong pace in 2021. Demand increased by 6% between 2020 and 2021, enabling electrical steel markets to register year-over-year growth of over 5% in 2021, as per FMI analysis.

Growth can be attributed to the increase of power generation and transmission projects across the globe. The demand for electrical steel has increased consistently and surprisingly for diverse applications across end-use industries.

Key factors fuelling the demand for electrical steel include initiatives undertaken for enhancing power distribution centers in developing nations. Leading steel manufacturing companies are focusing on expanding their production and distribution capacities in various countries. To improve their industrial research activities, some companies are collaborating directly with regional manufacturers.

The automobile segment is among the leading end-use industries influencing demand for electrical steel. In addition, the expansion of the global electric vehicle market is expected to fuel the demand for effective EV materials.

China has emerged as a highly lucrative market for the production and export of electrical steel. This can be attributed to increasing demand from the country’s manufacturing and automotive sector, coupled with the adoption of the advanced technology and higher production capacity.

Will COVID-19 Crisis Hamper Electrical Steel Market Growth Outlook?

Lockdown restrictions have negatively impacted the global electrical steel market. Limited production and transportation delays have created obstacles amid the pandemic. With the consecutive waves of the novel coronavirus tightening its noose on the global economy, production and distribution has been delayed.

Nonetheless, several end use industries such as automobile, energy, and construction have been adversely impacted. Additionally, increase in energy demand has resulted in higher adoption rates for transformers, generators, and installations for uninterrupted power supply across healthcare institutions.

Despite the difficult situation, economies are steadily recovering in 2021. Company activities have begun to recover at a steady pace as supply and distribution networks improve. Against this backdrop, the pandemic is unlikely to have a long-term effect on the electrical steel market.

Country-wise Insights

How is the Electrical Steel Market Set to Fare in China?

East Asia is predicted to remain one of the most attractive markets for electric steel during the forecast period, according to Future Market Insights. According to the study, China is expected to account for over 52% of the East Asia market through 2031.

China has built up a massive production capacity for iron and steel and the country is the largest steel producer worldwide with a crude steel production volume of nearly 1,064.8 million metric tons in 2020.

Furthermore, China remains one of the world's largest markets for the steel industry, making it a lucrative market for electrical steel manufacturers. Aside from this, rapid modernisation of its economy, and investments into construction, infrastructure, and manufacturing industries will drive growth in the market.

Why is Demand for Electrical Steel Increasing in the U.S.?

Demand in the U.S. market is expected to rise at nearly 5% CAGR over the forecast period. The U.S. has emerged as a leading player in the steel market in terms of production and consumption by various end-use industries in numerous applications.

The U.S. is recognized as a primary market for automobiles, energy, and construction industries and it is expected to continue exhibiting high demand for electrical steel through the forecast period.

Moreover, technological advancement through the 21st century has led to increased production capacity, and both domestic and international demand. Research and development activities, the presence of several major players, and increasing production capacities are creating attractive opportunities for electrical steel market in the country.

What’s Driving Sales in Japan?

Japan is one of the key manufacturers of steel and electrical steel. By 2031, it is expected to account for over 35% of electrical steel sales within East Asia.

In recent years, improved designs in the Japanese automobile industry to minimize maintenance, has been driven by significant sales of electrical steel in the country. Japan also has numerous small- and large-scale manufacturers, for sales across the globe making the country a leading market for electrical steel.

Moreover, in Japan, there are many end use markets for electrical steel. End use industries such as automobile, energy, and construction are always on the rise in Japan. Other end use industries such as manufacturing and fabrication industries are lucrative markets that have shown great demand for electrical steel, and will continue to do so in the coming years.

How are Government Initiatives Boosting Electrical Steel Sales in India?

In 2021, India will account for over 44% sales in the South Asia and Pacific region. Government initiatives undertaken to provide rural and urban electrification across the country with quality and affordable energy generation and distribution networks are anticipated to supplement the development of India's energy sector.

In addition, India is additionally considered as one of the top countries in steel production and consumption in the region, with a rising requirement for electrical steel for numerous end-use applications around the country.

Rising demand for automobiles aided by the increasing in population, lifestyle changes, and emergence of new product variants are also driving interest, supporting long term growth prospects.

Also, Indian producers are expecting to extend their business through consolidation, collaborations, and acquisitions with different organizations.

Category-wise Insights

Why is the Demand for Grain-Oriented Steel getting Stronger?

Based on electrical steel products, grain-oriented electrical steel holds the lead, accounting for nearly 51% of the market in 2021. Availability of grain-oriented electrical steel for applications in energy efficient transformers and large high-performance generators has been creating attractive growth prospects.

Grain-oriented electrical steel is expected to remain the top choice for many end use industries, owing to requirements of performance efficiency and cost-effective solutions to reduce the risk of power fluctuations and failures.

Which Application Accounts for Higher Sales of Electrical Steel?

Transformers are estimated to hold the largest revenue share of more than 45% in 2021 owing to rising investments in electrical infrastructure in urban areas, which is critical in transferring electrical energy from one electrical circuit to another.

Rise in the high-performance efficiency of transformers around the world, is expected to support the interest for electrical steel, during the forecast years, to meet energy transmission requirements.

Will the Energy Segment Continue Dominating Electrical Steel Market?

The energy segment is expected to contribute maximum revenue share of more than 33% in in 2021 owing to the rising number of applications and the repetitive use of transformers, motors, and generators, across the globe for uninterrupted energy demand.

Advancement in energy sector approaches in different nations like the U.S., U.K., and others has brought about improved cost-effectiveness for energy efficiency in transformers and generators.  

Competitive Landscape

Companies operating in the electrical steel market are aiming for strategic collaborations and partnerships with other manufacturers to expand their product manufacturing capacity to address the growing demand of an expanding consumer pool.

  • For instance, In May 2021, JFE Steel Corporation signed a memorandum of understanding to conduct a feasibility study with JSW Steel Limited (JSW) to establish a grain oriented electrical steel sheet manufacturing and sales joint-venture company in india.

Manufacturers are also focusing on the expansion of manufacturing facilities globally to maintain their global presence.

  • For instance, In November 2020, Nippon Steel announced plans to invest nearly US $1 billion to expand its electrical steel sheet facilities at two plants in Japan. This series of measures to improve capacity and quality will take full effect during the first half of 2023, with manufacturing capacity expected to increase by approximately 40%.
  • In March 2021, ArcelorMittal invested €13 million in its plant in Saint Chély d’Apcher, France, which specializes in iCARe electrical steels for the automotive sector. The investment means the plant will be able to produce cutting-edge non grain-oriented (NO) iCARe electrical steel grades, through production upgrades to meet the requirements of the electro mobility market.

Scope of Report

Attribute

Details

Forecast Period

2021-2031

Historical Data Available for

2016-2020

Market Analysis

USD Million for Value

Key Countries Covered

US, Canada, Germany, U.K., France, Italy, Spain, Russia, China, Japan, South Korea, India, ASEAN Countries, Australia, New Zealand, GCC Countries, Turkey, and South Africa

Key Segments Covered

Product type, Application, End Use and Region

Key Companies Profiled

  • Novolipetsk Steel
  • Voestalpine Stahl GmbH
  • POSCO
  • Nippon Steel & Sumitomo Metal Corporation
  • ThyssenKrupp AG
  • JFE Steel Corporation
  • Cogent Power
  • ArcelorMittal SA
  • Aperam SA
  • Baosteel Group
  • AK Steel Holding Corp
  • Allegheny Technologies, Inc.
  • Phoenix Mecano AG
  • Leicong Industrial Co., Ltd.
  • Nicore Electrical Manufactory Co., LTD.
  • Steel Authority of India Limited

Report Coverage

Market Forecast, Company Share Analysis, Competition Intelligence, DROT Analysis, Market Dynamics and Challenges, and Strategic Growth Initiatives

Customization & Pricing

Available upon Request

Key Questions Answered in the Report

  • What is the current valuation of electrical steel market?

    The electrical steel market is expected to surpass a valuation of US$ 37.5 Bn by 2021.

  • At what rate did the electrical steel market expand in the last 5 years?

    The electrical steel market exhibited steady YoY growth of 1.40% in the last five years from 2016 to 2020.

  • What is the electrical steel market demand outlook?

    The electrical steel market will register a gradual rise in demand after a period of decelerating sales amid COVID-19 in 2020. As per FMI, the market will register a CAGR of 6.5% between 2021 and 2031.

  • What are the key trends prevailing in the electrical steel market?

    Leading electrical steel manufacturers are bolstering production of grain-oriented offerings. Also, there is increasing focus on cost and resource efficiency in production technologies for the industry.

  • What are the key factors driving electrical steel sales?

    Increasing investments in electrical infrastructure and growing manufacturing activities in emerging economies are important factors boosting electrical steel sales.

  • What is the North America electrical steel market outlook?

    North America will remain the fourth-leading market for electrical steel, accounting for nearly 11.6% of sales in 2021, globally.

  • What is the cumulative share of the top five companies in electrical steel market?

    The top five companies operating in the electrical steel market are Nippon Steel and Sumitomo Corporation, POSCO, JFE Steel Corporation, ArcelorMittal and Baosteel Group. These companies will cover over 40% of the overall market in 2021.

  • At what rate will the electrical steel market grow in Europe?

    FMI has forecast the Europe electrical steel market to exhibit a CAGR of 5.9% between 2021 and 2031.

  • Which are the top 5 countries exhibiting high demand for electrical steel?

    Canada, China, Russia, India, and South Korea are among leading markets for electrical steel, exhibiting consistently high demand.

  • At what rate will the Japan electrical steel market grow?

    As per FMI, the Japan electrical steel market is expected to rise at 6.3% CAGR between 2021 and 2031 reaching 35.6% of the East Asia market.

Electrical Steel Market by Category

By Product Type:

  • Grain-Oriented Electrical Steel
  • Non-Grain Oriented Electrical Steel
    • Fully-Processed
    • Semi-Processed

By Application:

  • Inductors
  • Motors
    • 1hp - 100hp
    • 101hp - 200hp
    • 201hp - 500hp
    • 501hp - 1000hp
    • Above 1000hp
  • Transformers
    • Transmission
    • Portable
    • Distribution

By End Use:

  • Automobile
  • Manufacturing
  • Energy
  • Household Appliance
  • Others (Construction, Fabrication)

By Region:

  • North America
  • Latin America
  • Europe
  • East Asia
  • South Asia & Pacific
  • Middle East and Africa (MEA)

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