The global electrical steel market is experiencing a drastic uptick in its valuation owing to the increasing per capita consumption of electricity and the numerous regulatory norms aimed at reducing carbon emissions. Manufacturing efficient cores with improved properties would make power transformers much more efficient and the gradual loss in electrical energy would be contained. To tackle these challenges, the incorporation of electrical steel products across the energy sector is growing due to its various characteristics such as longevity, strong power density, magnetic properties, and high permeability. Moreover, the advent of electric vehicles and need to manufacture electric motors has been a pivotal factor that has boosted the electrical steel industry expansion in the recent years.
U.S. Grain Oriented Electrical Steel Market Size, By, 2018 & 2025, (Million tons)
How are Asian nations changing the face of the global electrical steel market in terms of product manufacturing, research, and business trends?
While taking stock of the progress being made by the electrical steel industry in terms of geographical reach and expansion, it is quite imperative to state that the Asian countries have recently appeared as lucrative terrains for industry players compared to other regions across the globe. One of the prominent factors for this continent to demonstrate an exceptional growth potential for this industry is the rising deployment of grain oriented electrical steel in the power sector and its growing acceptance in the electric vehicle space. Moreover, a few nations in the region have unveiled long-term research programs to develop sophisticated electrical steel products to support their power generation sector and provide a breather to the highly-stressed steel industry.
Apparently, electrical steel is an iron alloy which is predominantly known to convert energy into power voltages that are crucial in energy generation systems. In this context, it is quite interesting to note that Chinese manufacturers have specifically leveraged the advantage of electrical steel by using it in household appliances and in the power generation systems across rural and urban areas, essentially accelerating the demand for the product in the country.
Additionally, it has been observed that renowned electric automakers such as Tesla appear keen on setting up manufacturing facilities in China owing to its vast technological expertise. For instance, Tesla has started to build its Gigafactory 3 in Shanghai which would produce electric motors and battery packs for its upcoming electric vehicle models by 2020, invariably boosting the China electrical steel market. In fact, according to a research report thoroughly compiled by Global Market Insights, Inc., China gain oriented electrical steel industry is witnessing excellent product demand from household appliances, with the market size estimated to surpass a commendable remuneration figure of USD 95 million by 2025.
Apart from China, the demand for grain oriented electrical steel has witnessed a considerable uptick in India over the recent years. However, India is not entirely self-reliant when it comes to steel manufacturing capabilities with structural bottlenecks looming large. Taking this aspect into consideration, the Indian Government has decided to commence a pilot research and development project for manufacturing specialized electrical steel which is used for power transformers.
Part of the nation’s Make in India strategy, the INR 500 crore project would be monitored by Steel Ministry and would see participation from marquee steel makers along the likes of National Metallurgical Ltd, state-owned Rashtriya Ispat Nigam Ltd, and Tata Steel Ltd. The outcomes of such ambitious projects would boost the nation’s export capabilities and offer humongous business opportunities for the India electrical steel market players in the times to come.
Predominantly utilized to manufacture cores of generators, motors, and transformers, electrical steel helps in improving magnetic flux density, permeability, and minimize energy loss, owing to which it is widely deployed in automotive, manufacturing, and energy industries. And now with an increase in demand for hybrid vehicles along with rapid industrialization, the commercialization matrix of the global electrical steel market is forecast to exceed USD 22.5 billion by the year 2025.