The global electrical steel market was valued at a significant USD 28.53 billion in 2023 and is projected to expand at a compound annual growth rate (CAGR) of 4.7% from 2024 to 2030. A primary factor driving this market growth is the rising demand for electricity generation on a global scale. Electrical steel, as its name suggests, is characterized by its enhanced electrical properties, which include high permeability, elevated electrical resistivity, minimal hysteresis loss, and low magnetostriction. These attributes make it exceptionally suitable for various applications related to electricity generation, distribution, and consumption.
Electrical steel is utilized in a wide array of devices, including generators, electric motors, relays, solenoids, and other electromagnetic devices. These components are integral to power distribution systems and numerous related applications. Notably, the United States ranks as the second-largest electricity generator in the world, producing approximately 4,243 terawatt-hours (TWh) of electricity in 2022—a remarkable increase of 6.4% compared to 2021. Additionally, the burgeoning electric vehicle (EV) industry serves as another significant driver for the electrical steel market. The specific magnetic properties of electrical steel make it crucial for the rotors and stators in electric vehicle motors. By utilizing electrical steel, manufacturers can enhance motor efficiency, effectively minimizing core energy losses and extending the vehicle's range.
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Product Segmentation Insights
From a revenue perspective, the Non-grain Oriented Electrical Steel (NGOES) segment has dominated the market, capturing more than 71.0% of the share in 2023. NGOES is versatile and finds applications throughout the entire energy value chain, from generators to electric motors and various appliances. This type of electrical steel is available in multiple grades, each tailored to specific properties, compositions, and applications. On the other hand, Grain-oriented Electrical Steel (GOES) is primarily utilized in transformers and the charging infrastructure for electric vehicles. GOES exhibits high magnetic induction and a superior stacking factor, which allows for a reduction in the amount of material required in the winding of the core. Its advantageous magnetic properties help decrease core losses, providing cost-effective and efficient solutions for transformers.
GOES is employed in a variety of transformer types and is available in different grades, with variations in thickness. Over the forecast period, the GOES product segment is anticipated to register a higher growth rate compared to NGOES. This projected growth is fueled by an increase in transformer production. However, despite its promising growth potential, GOES currently holds a smaller market share largely due to its higher production costs when compared to NGOES. This cost factor can be a significant consideration for manufacturers, influencing their choice of materials and impacting the overall market dynamics for electrical steel.
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