Grain Oriented Electrical Steel Market Size, Share & Industry Analysis, By Product Type (Conventional, High Magnetic Strength Sheets, and Domain Refinement), By Thickness (0.2 mm and Below, 0.23 mm, 0.27 mm, 0.30 mm, and 0.35 mm and Above), By Application (Transformer, Power Generator, Electric Motor, and Others), and Regional Forecast, 2024-2032

The global grain oriented electrical steel market size was valued at USD 12.40 billion in 2023 and is projected to grow from USD 13.11 billion in 2024 to USD 20.48 billion by 2032, exhibiting a CAGR of 5.7% during the forecast period. Asia Pacific dominated the grain oriented electrical steel market with a market share of 70.56% in 2023. Moreover, the grain oriented electrical steel market size in the U.S. is projected to grow significantly, reaching an estimated value of USD 1.54 billion by 2032, driven by the increasing demand for electric vehicles in the U.S.

Grain oriented electrical steel is a significant material used in fabricating energy-efficient transformers and high-performance generators. Primarily found in the form of punched, laminated, or wound sheets, it is a vital core material for power transformers, small transformers, and distribution transformers. The increasing product demand from power generation and the growing electrical industry globally are driving the market growth. Furthermore, the rising electrical vehicle charging infrastructure is expected to fuel product adoption.

During the COVID-19 pandemic, many countries, such as China, the U.S., India, and Germany, announced restrictions on raw material and labor transportation, impacting the supply chain of steel manufacturers. In addition, the revenue generation of several manufacturing companies was affected owing to the facility closures. The power generator demand was affected due to the decreased power usage from high-end commercial consumers. The lockdown restrictions directed the population to work from home, lowering commercial power consumption and reducing steel uptake. However, the market has stabilized since 2022 owing to the normalizing electricity demand from the industrial sector.

Grain Oriented Electrical Steel Market Trends

Increasing Demand for Electric Vehicles Offers Growth Opportunities for the Market

The rising demand for electrical steel from the automotive industry for application in electric vehicles is opening growth opportunities for the market. The automotive industry is redesigning due to numerous factors that aim to increase profit margins and benefit the environment, which leads to increasing demand for electric vehicles. Electrical steel is one of the core magnetic materials in EV traction motors, which determines the vehicle's power and is vital for the efficient performance of EVs. Therefore, high-quality electrical steels are sought by OEM manufacturers for the growing EV market.

Electrical steel is used in engines, traction motors, high-speed rotors, electric motors, charging infrastructure for electric vehicles, and conventional generators. The rapidly growing automotive industry has escalated the demand for electric cars as a substitute to petroleum-fueled vehicles. This has increased the demand for EVs, propelling the grain oriented electrical steel adoption.

Grain Oriented Electrical Steel Market Growth Factors

Growing Product Demand in the Electrical Industry to Fuel the Market Growth

The rising product demand for power generation applications in developing countries is driving the grain oriented electrical steel market growth. The increase in population, economic development, and urbanization has surged the construction of industrial buildings, warehouses & storage units, and metro stations where the product is used as lamination steel and transformer steel for electric power distribution. These infrastructure developments have increased the demand for electricity. Growing preference for electrical steels due to their lesser core loss, superior magnetic properties, and high permeability is poised to boost the market growth during the forecast period.

The rising demand for electrical steel across the globe is associated with increasing innovative technology deployment and demand for higher efficiency in the power sector. The product offers high electrical resistivity and decreased hysteresis loss in hermetic motors and Alternating Current (AC) motors. Moreover, the increasing investment by the government and municipal corporations in local power networks to connect rural areas and growing communities is poised to surge product adoption.

Furthermore, companies are investing in the setup of fuel extraction machinery and power plants, driving the electrical steel demand from the oil & gas industry. In addition, residential housing schemes offered by the governments have created high product usage to provide electricity through the installation of power generators and transformers. This is anticipated to aid the growth of the global market.

RESTRAINING FACTORS

Fluctuations in Prices of Steel May Restrain the Market Growth

Steel has witnessed price fluctuations on a daily basis. Along with this, the raw materials used for steel production, including scrap steel, iron, and coal, have also witnessed price fluctuations. The prices of raw materials are highly unstable, considering the laws of supply and demand. Furthermore, production costs impact prices along with storage capacity, affecting the final product price. Furthermore, the production cost of transformers is relatively on the higher side, with a lack of financial ability to earn a return on investment. This, along with the limited availability of energy-efficient transformers and increased import costs or tariffs, raises the final price of the product. In addition, greater environmental and health risks restrain the grain oriented electrical steel adoption in the market.

Grain Oriented Electrical Steel Market Segmentation Analysis

By Product Type Analysis

Conventional Segment to Hold Dominant Share Owing to Rising Demand for Electrical Supply

Based on product type, the market is categorized into conventional, domain refinement, and high magnetic strength sheets.

The conventional segment dominated the market in 2023 and may continue its dominance till 2032. The segment covers electrical steel for applications such as transformers, power generators, conventional lamination steel, and industrial induction machines. The growing demand for electrical supply due to higher dependence on technologies and urbanization is surging the segment growth.

The high magnetic strength sheets segment includes product usage for improving the quality of steel lamination in motors and stators. This segment is poised to register significant growth during the review period. The growing automotive industry has propelled product demand as the increase in fuel prices has led to the adoption of electric vehicles. Thus, this factor is impelling the high magnetic strength sheets segment growth.

The domain refinement segment is slated to show a moderate growth rate during the forecast period. The domain refinement segment includes heat-resistant magnetic materials steel, which can be used in stacked cores and does not require annealing while also having low iron loss. The low iron loss in grain oriented electrical steel can be observed by reducing hysteresis and improving the orientation integration degree.

By Thickness Analysis

0.23 mm Segment Registered the Dominant Share Owing to its Wider Usage in Household Appliances

On the basis of thickness, the market for grain oriented electrical steel is segmented into 0.23 mm, 0.35 mm and above, 0.2 mm and below, 0.30 mm, and 0.27 mm.

The 0.23 mm segment accounted for the dominating share in the market in 2023. This thickness is commonly deployed in applications such as small transformers, generators, and electric motors. This type of electrical steel is used in small-scale applications, such as the manufacturing of small motors, similar to those found in appliances such as refrigerators, washing machines, and air conditioners. The rising demand for such household applications is expected to drive the segment growth during the forecast period.

Furthermore, the grain oriented electrical steel with thickness 0.35 mm and above is used in applications that require very high magnetic flux densities such as large generators and motors. The steel is used in power distribution systems and other high-power applications. The rising demand for energy across the globe is expected to benefit and drive the segment’s growth significantly.

By Application Analysis

Transformer Segment Accounted for the Largest Share Due to the Rising Energy Consumption

On the basis of application, the market is segmented into transformer, power generator, electric motor, and others. The transformer segment held the largest grain oriented electrical steel market share in 2023. The product is suitable for high-performance generators and energy-efficient transformers. Used as a laminated, punched, or wound sheet, steel is an essential core material in power, small, and distribution transformers. Rising energy consumption across the globe is expected to create higher demand for transformers, which are an essential part of the electric infrastructure. This would, in turn, increase the consumption of grain oriented electrical steel used in transformers and drive the segment growth.

At the same time, the electric motor segment is expected to grow considerably during the forecast period. Electric motors use electrical steel as laminations. The growing preference for electric vehicles in the automotive industry has raised the demand for electric motors, thereby surging raw materials consumption.

REGIONAL INSIGHTS

Regionally, the grain oriented electrical steel market is divided into the Asia Pacific, Europe, North America, Latin America, and the Middle East & Africa.

The Asia Pacific accounted for the largest market share, with a value of USD 8.75 billion in 2023. The rising demand for grain oriented electrical steel in the region is attributed to the growing manufacturing sector. South Korea, India, and China are the leading countries in the manufacturing sector.

The market growth in North America is mainly driven by the presence of economically stable nations supporting technological development. Furthermore, the rise in several end-use industries, including automotive and machinery, where the product is used in transformers, power generators, and motors, is expected to drive market expansion in the region.

Europe is technologically advanced and supported by developed economies where the product is in demand for the production of industrial equipment, machinery, and engines. Germany held a significant market share in 2023. It is a major manufacturer of automobiles in the region where grain oriented electrical steel is used in engines and electric motors.

The Latin America market share is expected to grow at a considerable rate over the forecast period. This is due to the rising product application in the automotive and manufacturing industries. Several end-use industries have manufacturing facilities in the region due to raw materials, labor, and land availability. This has led to a high demand for automated machinery, leading to product consumption.

The rising economy in the Middle East & Africa has supported the adoption of electric vehicles and led to product demand in manufacturing engines and electric motors.

List of Key Companies in Grain Oriented Electrical Steel Market

Key Players Focus on Product Innovations to Strengthen Their Position

The major players operating in the market are Nippon Steel Corporation, ArcelorMittal, POSCO, and ThyssenKrupp Steel. The companies are involved in product innovation, collaborations, capacity improvement, and acquisition in the market. Nippon Steel Corporation is a prime manufacturer of steel. Furthermore, the company is involved in acquisitions, Rx&D activities, and steel innovations to meet the consumers’ demands.

LIST OF KEY COMPANIES PROFILED

• ArcelorMittal (Luxembourg)


• POSCO (South Korea)


• Stalprodukt S.A. (Poland)


• Baosteel Group Corporation (China)


• NIPPON STEEL CORPORATION (Japan)


• JFE Steel Corporation (Japan)


• thyssenkrupp Steel (Germany)


• Cleveland-Cliffs Inc. (U.S.)


• Arnold Magnetic Technologies (U.S.)


• VIZ-Steel (Russia)

KEY INDUSTRY DEVELOPMENTS

• October 2023 - The NIPPON STEEL CORPORATION announced that GE Vernova will be utilizing low CO2 steel product “NSCarbolex Neutral” for the production of transformers. In addition, GE Vernova highly recognizes the commercial and technical benefits of Nippon’s Grain Oriented Electrical Steel Sheets, to which “NSCarbolex Neutral” is being applied.


• August 2023 - The JFE Steel Corporation announced that they have signed a joint venture agreement named “JSW JFE Electrical Steel Private Limited” between JFE Steel Corporation and JSW Steel Limited to lay out the foundation for the production of a grain-oriented electrical steel sheet (GOES). The joint venture target is to cater to growing GOES demand from the Indian market for greener energy network enhancement projects. The total investment is planned to be USD 670 million.


• February 2023 - The thyssenkrupp Steel strengthened its production facility to produce cold rolled grain oriented steel in India. The company can produce superior grades of CRGO with a production capacity of 50,000 tonnes.


• March 2022 – ArcelorMittal announced an investment of USD 328 Mn to create a new production unit for electrical steels at the Mardyck site in the north of France. The facility specializes in the production of electrical steels for the engines of electric vehicles, which complements ArcelorMittal’s existing electrical steel plant. The new industrial unit will have a 200-kiloton production capacity and will strengthen the French electromobility sector.


• March 2021- Arnold Magnetic Technologies acquired Ramco Electric Motors, Inc., a manufacturer of rotors, stators, and full electric motors. This acquisition brings Arnold Magnetic Technologies into a position where they can offer diverse product offerings with industry-leading electric motor solutions capabilities.

REPORT COVERAGE

The market research report provides a comprehensive analysis of the industry and focuses on crucial aspects such as leading companies, product types, thickness, and applications. The report also covers insights on key market trends and highlights the latest industry developments. In addition, it includes various factors that have contributed to the market growth in recent years.

Report Scope & Segmentation