The electrical steel market is forecasted to value around USD 47,779.1 million in 2025 and is likely to reach a valuation of USD 88,959.6 million by 2035 with a significant CAGR of about 6.3% during the forecast period. This growth pattern points towards the importance of electrical steel in power transmission, electric vehicles, industrial machinery, and renewable energy systems.
One of the primary drivers of the industry is the worldwide shift to clean and efficient forms of energy. All industries and governments aim for less energy consumption, a reduced carbon footprint, and modernization of aging electrical infrastructures. For this reason, there is an increase in demand for advanced grades of product with even better magnetic properties and lower energy losses.
In addition, the expansion of power generation and distribution with smart grid deployment will drive demand for the electrical steel sector.The rapid increase in electric vehicles (EVs) is a major contributor to this. Electrical metals are vital in EV motors and charging infrastructure, where they have characteristics such as efficiency, durability, and lightweight design.
Emission regulations continue to tighten in all major automobile-producing countries. New car production and sales are increasingly favored for EVs, resulting in the dominance of the automotive sector as a high-performance industry segment. The growth in the demand for renewable energy, mainly from wind farms and solar farms, has increased the usage of transformers and other components related to product usage. Such applications require long-term reliability, minimized maintenance, and excessive operational efficiency.
The improvements brought about by technology in processing steel, particularly laser scribing and insulation-coating techniques, are enabling manufacturers to produce high-grade products through higher efficiency and performance. New advancements in metallurgies also contribute to the development of steels that exhibit ultra-low core losses, thus supporting energy conservation goals across applications.
| Metric | Value |
|---|---|
| Industry size (2025E) | USD 47,779.1 million |
| Industry Value (2035F) | USD 88,959.6 million |
| CAGR (2025 to 2035) | 6.3% |
The industry addresses high technical standards and performance requirements, especially in energy and automotive applications. Both raw material suppliers and manufacturers prioritize material efficiency, magnetic performance, and reliability in supply since these dimensions have a direct bearing on conductivity and transformer or core performance (red). Meanwhile, manufacturers focus on production costs and compliance with regulations, which is a balancing act between technological standards as well as environmental and safety standards.
With regard to production costs and industry demand, retailers/distributors rely on this for inventory turnover and competitive pricing. As such, end-use industries, such as automotive and energy, show the following preferences concerning magnetic performance, material efficiency, and related regulations: these directly tie into energy savings and system longevity overall.
From 2020 to 2024, the industry witnessed rapid growth on account of increasing demand in power generation, automotive, and industrial motor applications. The trend toward energy-efficient electric motors and transformers drove the adoption of grain-oriented (GOES) and non-grain-oriented (NGOES) electrical steels.
Governments across the globe urged tighter energy efficiency norms, which again propelled uptake in EVs, renewables, and smart grid networks. Supply chains and the cost premium of top-grade products were the major bottlenecks.Ahead towards 2025 to 2035, the industry will be determined by the international wave of electrification, particularly with the tremendous pick-up speed of electric vehicles (EVs), smart grids, wind farm turbines, and solid-state transformers.
Developments in nano-structured products, amorphous metal alloys, and artificial intelligence-driven steel design will have lighter, more efficient, and eco-friendly materials. Carbon neutrality and sustainability in the production of steel will be at the core, driving the green production of steel through hydrogen-based technologies and electric arc furnaces. Further, the use of AI-based predictive maintenance and IoT in power equipment will again lead to higher demands for high-performance products.
Comparative Market Shift Analysis (2020 to 2024 vs. 2025 to 2035)
| 2020 to 2024 | 2025 to 2035 |
|---|---|
| Mandates on energy efficiency, increased EVs, transformer refurbishments, and electrification in urban areas. | Mass electrification, green energy consumption, hydrogen economy, and digital grid integration. |
| Grain-oriented (GOES), non-grain-oriented (NGOES), plain silicon steel. | Nanostructured , amorphous alloys, hybrid products s , and low-carbon "green steel". |
| Transformers, electric motors, generators, and industrial equipment. | Intelligent EV motors, solid-state transformers, wind turbines, AI-based power systems. |
| Increased silicon content, advanced lamination and insulation coatings. | AI-optimized alloy design, magnetic loss minimization through nanostructuring , and 3D-printed magnetic cores. |
| Basic emission controls, energy-efficient product design. | Hydrogen steelmaking, electric arc furnaces, recyclable steel parts, closed-loop production. |
| Highly dependent on a few nations (China, Japan, Germany), some volatility in raw materials. | Decentralized production centers, nearshoring of steel mills, and digitalized logistics chains. |
| Growing application in hybrid and fully electric vehicles. | EV-specific product types, ultra-thin laminations for high-speed motors, circular reuse models. |
| Transformer retrofits and grid expansion projects. | Integration with smart grids, solid-state switchgear, and renewable energy storage solutions. |
| High production cost, low recycling efficiency, import reliance. | Balancing high efficiency with sustainability, raw material substitution, and circular economy integration. |
| IEC and regional energy efficiency requirements in appliances and transformers. | Net-zero carbon requirements, green building codes, renewable energy hardware standards, and local content regulations. |
Various risks within the industry impact its stability and growth. The most common among these risks is that of industry risk, particularly because of global demand swings. Industry mainly depends on factors like automobiles (electric vehicles mostly), energy (transformers and motors), and construction. Weaknesses in these areas, irrespective of the cause, such as economic recession, geopolitical instability, or energy policy change, lessen the demand for product.
The market is also subject to price fluctuations of raw materials, specifically iron ore and coking coal; this directly influences manufacturing costs and profit margins, especially amongst less price-powerful companies. Operational risks arise from the necessary capital intensity and technical complexity associated with product production. The entire production process, particularly that of grain-oriented (GO) electrical steel as well as non-grain-oriented (NGO) electrical steel, demands stringent control coupled with quality assurance.
Any disruption in the manufacturing processes on account of equipment failure or supply chain bottlenecks, as well as a shortage of labor, might cause a delay in delivery, increased costs, or loss of customer loyalty. Moreover, the technological expertise needed to keep up with the latest efficiency and magnetic property standards stiffens pressure on relatively smaller or novice entrants into this industry.
There are high regulatory and trade risks as well. The steel industry is usually one of the most tariffed, duty-imposed, and anti-dumping sectors, which affects its trade flow and leads to increased costs for importers and exporters. For example, the USA tariffs on steel imports have changed the prices and availability of product used in transformers, which is concerning utility companies. Also, environmental regulations regarding carbon emissions, waste disposal, and energy use are becoming stiffer. Heavy modifications in production facilities or changes in materials used would incur high costs.
On account of the environment and sustainability, markets will feel greater pressure on the ecological footprint of steel production during this time. Steel manufacture is extremely energy-intensive and is, therefore, a significant contributor to greenhouse gas emissions.
As ESG (Environmental, Social and Governance) factors are increasingly becoming important to investors and regulators alike, the adoption of greener technology is what companies will have to show, as will responsibly sourcing and recycling practices. Nonconformity towards sustainability expectations would mean reputational damage or loss of key investment funds.
| Countries | CAGR (2025 to 2035) |
|---|---|
| USA | 6.3% |
| UK | 5.8% |
| France | 5.5% |
| Germany | 6.1% |
| Italy | 5.2% |
| South Korea | 6.7% |
| Japan | 5.9% |
| China | 7.4% |
| Australia | 5.3% |
| New Zealand | 4.9% |
The USA electric steel industry will grow at a CAGR of 6.3% during 2025 to 2035, with growing investments in renewable energy infrastructure and powering the grid with modernization. Increasing demand for efficient motors and electric transformers is compelling domestic consumption vigorously. Moreover, policy efforts to popularize electric vehicles (EVs) and hybrid systems are also fuelling the industry further.
Dominant producers like AK Steel, Cleveland-Cliffs Inc., and United States Steel Corporation are top industry players that are aggressively expanding their capacity. Increased usage of electric powertrains in vehicle applications is also fueling demand for non-grain-oriented electrical steel. In contrast, the grain-oriented ones continue to play a critical role in applications involving power transmission and distribution.
The UK industry is expected to grow with a CAGR of 5.8% through the forecast period, which is largely driven by the demand for cleaner forms of energy consumption and electric transport. The focus on minimizing carbon emissions has led to a relentless demand for energy-saving electrical parts in industrial as well as commercial applications.
Major industry players like Tata Steel, UK, and Liberty Steel are concentrating on cutting-edge production techniques and strategic collaborations to meet increasing domestic needs. Wind turbine installation and EV charging stations are driving demand for products globally, particularly transformers and inductors that energize renewable energy grids.
France's industry is anticipated to expand at a 5.5% CAGR during 2025 to 2035. The country's energy policy of decarbonization and sustainable nuclear power is propelling demand for product. Increased investment in smart grid technology and electric mobility are also fueling industry forces ahead.
Companies like ArcelorMittal and Aperam are industry leaders in industry growth through innovation and capacity expansion. The product is increasingly being used in applications like power transformers and high-performance motors for domestic upgrading and the growing EV base.
Germany is expected to experience a CAGR of 6.1% in the industry between 2025 and 2035. The strong automotive industry, combined with the high level of focus on energy conversion and industrial electrification, is driving up the use of high-quality magnetic materials. Energy-efficient motor cores and renewable energy infrastructure are some of the industry drivers for consumption.
Industry players such as Voestalpine and Thyssenkrupp are increasing R&D activities to produce high-quality products that can meet changing technological demands. Use in EV production, wind energy equipment, and power transformers is driving robust industry growth.
Italy's industry is likely to expand at a CAGR of 5.2% over the forecast period, with industrial automation trends and increasing grid modernization initiatives. Expansion of the national electrification agenda, particularly in public transport and renewable energy generation, is fueling material demand.
Industry leaders like Marcegaglia and Acciaieried'Italia are leading by integrating production activities and diversifying product lines. Increased emphasis on grain-oriented electrical steel for transformer cores and non-grain-oriented electrical steel for electric motors will enhance industry stability.
The South Korean industry is expected to register a 6.7% CAGR between 2025 and 2035, fueled by the electronics and the automotive industry's technological superiority. The spread of EVs and the growth of smart grids are considerably propelling the use of high-performance products.
Major players such as POSCO and Hyundai Steel are using innovation and sustainability to increase capacity. Increasing local demand from domestic customers and foreign buyers for high-grade electrical machinery and automotive uses is stimulating the production of higher grades of grain and non-grain-oriented steel.
Japan's industry is anticipated to expand at a CAGR of 5.9% during the forecast period, supported by robust demand from the industrial machinery and automotive sectors. Initiatives to minimize energy losses and maximize equipment efficiency are influencing the selection of materials for applications in motors and generators.
Players like Nippon Steel Corporation and JFE Steel are emphasizing precision manufacturing to meet strict performance standards. The rising use of products in high-frequency motors of EVs and robotics is propelling industry growth in domestic and export markets.
China will also lead the industry, with a growth rate of 7.4% during the forecast period. Key growth drivers include long-term industrialization, mass-scale adoption of EVs, and comprehensive replacement of national power infrastructure. Government policies on emissions reduction through carbon neutrality and energy efficiency are also driving demand.
Large producers such as Shougang Group and Baowu Steel Group are expanding capacity and investing in advanced processing technologies. Uses in segments such as grid enhancement, electric mobility, and energy-efficient appliances are propelling a diversified and healthy industry.
The Australian industry will expand at a CAGR of 5.3% from 2025 to 2035, with constant innovation in renewable energy schemes and rising electrification of rural and remote regions. There is a rising need for efficient transformers and motors, and initiatives are being made to modernize infrastructure.
Imports and partnerships with global suppliers are enabling industry growth. Key stakeholders are observing the use of products in applications that are synergistic with the nation's net-zero objectives, especially in solar and wind infrastructure and clean transportation networks.
New Zealand is projected to grow at a CAGR of 4.9% through the forecast period in the industry. Strategic energy reforms and decarbonization policies for the transport segment are adding demand. Demand for efficient transformer and motor systems is picking up pace with utilities and manufacturing sectors.
Imports and collaborations are meeting local markets with international suppliers, whereas domestic production sites are constrained. Uses in power grid refurbishment, electric vehicle charging infrastructure, and green building technology are driving future industry potential for products.
The industry is prominently divided into grain-oriented electrical steel (GOES) and non-grain electrical steel (NGOES), with NGOES holding the dominating share of 65%, while GOES has a meager 35%.Used in rotating machines, NGOES find applications in motors, generators, and small transformers. Isotropic magnetic properties allow the material to be used for AC electric motors in various applications, such as industrial machinery, automotive alternators, and household appliances.
The phenomenal rise in demand worldwide for electric vehicles has, therefore, accelerated the demand for NGOES, which happens to be one of the important materials for EV traction motors. Industry giants such as ArcelorMittal, Tata Steel, and JFE Steel have been heavily investing in producing high-grade NGOS to satisfy the surging demand driven by the automotive and renewable energy sectors. Although grain-oriented electrical steel occupies only 35% of the industry worldwide, its importance in high-efficiency transformers and large electrical equipment is quite significant.
The one-way superior magnetic properties mean that GOES has very low core losses, which are important in power distribution and transmission. In developing countries, the ongoing upgrades of aging grid infrastructure have been a driver for GOES demand. Suppliers of grain-oriented steel include Nippon Steel Corporation, POSCO, and Thyssenkrupp Electrical Steel, which focuses on ultra-low loss grades to meet energy efficiency regulations.
Throughout the development of next-generation electrical systems, the roles of GOES and NGOs will continue to be relevant as industries are working toward energy efficiency, and electrification is gaining momentum across the globe.
The industry is divided into two major end-use sectors: energy, with a dominating industry share of 28%, and automobile, accounting for around 22%.
The energy domain takes the lead due to the extensive use of products in power generation, transmission, and distribution infrastructure. GOES is characterized by excellent magnetic permeability and low core loss, which makes it suitable for use in high-efficiency transformers, reactors, and any other static machines.
Currently, the major global shift toward renewable energy, from the currently available energy sources like solar, requires very good grid infrastructure, which in turn drives more demand for the product. The OEM manufacturers- ABB, Siemens Energy, and Schneider Electric- use high-grade GOES materials to improve transformer performance and stringent energy efficiency ratings.
Government funds are being channeled globally towards upgrading aging electrical grid systems that assimilate renewable energy, which, in turn, increases demand in both developed and developing economies. On the other hand, the automotive sector is a fast-expanding consumer of non-grain-oriented electrical steel (NGOES), mainly owing to the growing number of electric vehicles (EVs) and hybrid models. NGOEs suit EV traction motors, onboard chargers, and auxiliary motors due to their uniform magnetic properties and lower energy loss in rotating components.
Leading automotive OEMs such as Tesla, BMW, and Toyota are beginning to source specialist electrical steels for high-performance drivetrains. Product producers such as JFE Steel and Cleveland-Cliffs are expanding their automotive-grade NGOES portfolios to meet this fast-growing demand. Product will continue to be a necessary material as both the energy and automotive industries promote electrification and efficiency; consequently, steady growth of end-use demand is expected through the decade.
The electrical steel market is highly consolidated, with the key players leveraging advanced manufacturing technologies, strong distribution networks, or strategic collaborations to keep their competitive advantage. Novolipetsk Steel, Voestalpine Stahl GmbH, and POSCO are key industry players focusing on high-performance grain-oriented electrical steel and non-grain-oriented electrical steel with a substantial share of the industry. They are active in research and development to enhance the grades with better magnetic characteristics and energy-efficient applications for industries including automotive, power generation and transformers.
Nippon Steel & Sumitomo Metal Corporation and ThyssenKrupp AG continue to be important competitors that put a strong emphasis on innovation and sustainable production. The efforts being put into manufacturing low-carbon steel and AI-enabled systems for quality control further cement their position in the industry by ensuring the reliability and performance of their products. Besides, development in key regions such as Europe, North America, and Asia, as well as securing long-term contracts with the leading automobile and electrical equipment manufacturers, presents an added advantage.
JFE Steel Corporation, Cogent Power as well as ArcelorMittal SA enhance the competition through niche offerings such as ultra-thin products catering to high-frequency applications. Their customization for specific customer requirements makes them a preferred supplier to industries with narrow performance specifications. These companies are also engaged in digitalization and supply chain optimization to improve cost efficiency and responsiveness to industry needs.
Aperam SA, Baosteel Group, AK Steel Holding Corp, and Allegheny Technologies, Inc. remain major players that target regional industry development and niche applications. Some strategies they adopted consist of acquiring smaller manufacturers, developing modern coatings for products, and forming joint ventures with local distributors. Their competitive edge lies in producing highly efficient products tailored for applications in electric vehicles, renewable energy, as well as smart grids.
Market Share Analysis by Company
| Company Name | Market Share (%) |
|---|---|
| Novolipetsk Steel | 18-22% |
| Voestalpine Stahl GmbH | 15-20% |
| POSCO | 12-16% |
| Nippon Steel & Sumitomo Metal Corporation | 10-14% |
| ThyssenKrupp AG | 8-12% |
| Others (combined) | 20-30% |
| Company Name | Key Offering and Activities |
|---|---|
| Novolipetsk Steel | Advanced products s with state-of-the-art coatings for high-performance power transformers and vehicle electrification. |
| Voestalpine Stahl GmbH | Highest-quality products tailored to renewable energy and intelligent grid usage. |
| POSCO | Grain-oriented and non-grain-oriented products with quality control via AI for higher efficiency. |
| Nippon Steel & Sumitomo Metal Corporation | Super-slim products for electric motors and transformers and high-frequency operation. |
| ThyssenKrupp AG | Electrical steel solutions based on low-carbon manufacturing technology and high permeability. |
Key Company Insights
Novolipetsk Steel (18-22%)
Industry leader in high-efficiency electrical steel through AI-based production as well as a sophisticated coating for transformers and electric vehicles.
Voestalpine Stahl GmbH (15-20%)
Premium electrical steel focus, working with renewable energy companies to advance grid stability and efficiency.
POSCO (12-16%)
Grows in Asia-Pacific through state-of-the-art grain-oriented steel solutions to high-efficiency power transformers and EV markets.
Nippon Steel & Sumitomo Metal Corporation (10-14%)
Invests in the production of ultra-thin steel with excellent magnetic properties to power next-generation electric motors and smart grid devices.
ThyssenKrupp AG (8-12%)
It focuses on environmentally friendly production and creating recyclable electrical steel to help the world adopt carbon-neutral energy infrastructures.
Other Key Players
The industry is segmented into grain-oriented electrical steel and non-grain oriented electrical steel.
The industry is categorized into inductors, motors, and transformers.
The industry is segmented into automobile, manufacturing, energy, household appliance, and others.
The industry is divided into North America, Latin America, Europe, Asia Pacific, and Middle East and Africa.
The market is estimated to be worth USD 47,779.1 million in 2025.
Market sales are expected to reach USD 88,959.6 million by 2035, driven by rising demand for energy-efficient motors, transformers, and electric vehicle components.
China is witnessing fastest growth at a CAGR of 7.4%, supported by rapid industrialization and expansion in power infrastructure and electric mobility.
Non-grain oriented electric steel is widely used.
Key companies in the market include Novolipetsk Steel, Voestalpine Stahl GmbH, POSCO, Nippon Steel & Sumitomo Metal Corporation, ThyssenKrupp AG, JFE Steel Corporation, CogentPower, ArcelorMittal SA, Aperam SA, Baosteel Group, AK Steel Holding Corp, and Allegheny Technologies, Inc.
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