Electrical Steel Market Size, Production Capacity, Raw Material Pricing, Manufacturing Cost, Market Share, and Demand Forecast

Revenue, 2026

USD 54.02 Bn

Forecast Year, 2035

USD 99.44 Bn

CAGR, 2026 - 2035

7.02%

Report Coverage

Global

What is the Electrical Steel Market Size?

The global electrical steel market size was estimated at USD 50.44 billion in 2025, and is projected to hit around USD 54.02 billion by 2026, and is anticipated to reach around USD 99.44 billion by 2035, expanding at a CAGR of 7.02% from 2026 to 2035. Growing demand for renewable energy, grid modernization and EVs is significantly driving the market.

Electrical Steel Market Key Takeaways

• In terms of revenue, the market is valued at $54.02 billion in 2026.
• It is projected to reach $99.44 billion by 2035.
• The market is expected to grow at a CAGR of 7.02% from 2026 to 2035.
• By product, the non-grain oriented electrical steel (NGOES) segment has held the largest market share of more than 71% in 2025.
• By application, the transformer segment accounted for 53% of the overall market share in 2025.
• By end user, the energy segment has held a market share of 34% in 2025.
• By region, Asia Pacific region has contributed a revenue share of over 72% in 2025.
• North America region has held a market share of 9% in 2025.

Market Overview

The pandemic had affected the electric steel market negatively. The disrupted operations of the manufacturing plants, halt in the infrastructure projects and the decline in the automobile production during the lock down had affected the market growth majorly. The demand for electricity across many nations had dropped during the lockdown. Electrical steel is the ferromagnetic material which has different quantities of silicon. It helps in reducing the dissipation of heat and therefore it is used across many industries. Dissipation of heat leads to energy wastage so there is an increased application of electrical steel in devices.

Increased focus of the governments on energy efficiency is promoting the product growth. In order to support the power generation in many countries like India, UAE, China Governments are coming up with initiatives which are foreseen to bolster the demand for this product. Due to the replacement of old transformers and advancements in transmission lines due to the trend of smart transformers there shall be rampant growth in the demand for this product. Electrical steel is able to provide higher efficiency and it is extremely sustainable. Under the sustainable development program of the United Nations the vendors of the electrical steel market shall have a lot of benefits in terms of revenues.

How is AI Revolutionizing the Electrical Steel Industry?

AI is revolutionizing electrical steel processing and shaping the future of manufacturing. AI models for non-grain-oriented steel focus on uniform grain size and texture, while grain-oriented electrical steel models prioritize Goss texture development. The thermal profiles differ significantly, with GOES needing higher temperatures and longer soak times. AI adapts to these differences by using separate neural networks trained on grade-specific data. Conventional statistical process control often falls short in capturing the complex, non-linear interactions between strip speed, furnace zones, and chemical composition. This is where AI-driven predictive models and real-time analytics transform production.

Key factors influencing future market trends

• Increase Demand for Electricity: Rising demand for electricity through rapid industrialization, population, and urbanization processes is highlighting the need for energy-saving electrical equipment. Electrical steel can perform high magnitudes and enhance the efficiency of the generator and transformer.
• Manufacturing potentiality: standardization of electrical steel will enable the countries to be on equal terms concerning international standards that will ensure that their economies become competitive, and consequently, it will lead to the proliferation of energy-efficient electrical components in the established markets.

Electrical Steel Market Growth Factors

Electrical steel is a soft magnetic material which has improved electrical properties and varied applications in electric motors, solenoids, generators, small relays and other. Electrical steel is also known as lamination steel or Transformers steel. It helps in reducing the dissipation of heat. Due to the presence of silicon in the electrical steel there is an increased resistivity and improved permeability. Due to these factors there's an increase in the demand for the generation of energy and transmission with the use of electrical steel. Increasing popularity of profoundly efficient, elite execution and low emission vehicles along with the regulations by the government regarding the vehicle discharge is driving the growth of electric vehicles.

• The electric vehicle is lightweight and helps in meeting the security principles. These factors provide new opportunities for the growth of this market.
• Increased per capita income in the developing regions like India Mexico and China will support the development of this product.
• Increase in the usage of electric cars across Europe is expected to helping the growth of the market during the forecast period.

Pictures of electrical industry and the electronics industry are making an effective utilization of electrical steel as it is able to provide abrasion resistance, improved durability, strength and vibration control. It also helps in reducing the production cost and improves the quality of the product. Owing to all of these reasons the electrical steel market is expected to grow during the forecast period.

What are the Government Initiatives Influencing the Electrical Steel Market?

• The government of India introduced the Production-Linked Incentive (PLI) scheme for specialty steel, encouraging domestic manufacturing of electrical steel, attracting investments, and reducing reliance on imports while strengthening the country's industrial capabilities.
• Governments across regions promoted green steel initiatives by supporting low-carbon technologies, renewable energy adoption, and hydrogen-based production methods, helping electrical steel manufacturers align with sustainability goals and reduce overall carbon emissions.
• Various countries implemented electric vehicle subsidies, mandates, and infrastructure development programs such as FAME and ZEV policies, which indirectly increased demand for electrical steel used in motors, transformers, and energy-efficient systems.
• Trade-related measures, including import monitoring systems, tariffs, and domestic procurement policies, were introduced by governments to protect local steel industries, stabilize supply chains, and ensure the availability of critical materials like electrical steel.

Electrical Steel Market Trends

• Rising demand for high magnetic strength sheets in the rapidly growing electric vehicle (EV) market owing to its ability for enhancing the quality of steel lamination in motors and stators.
• Increased emphasis on reducing CO2 emissions with the development of innovative production methods for manufacturing sustainable and eco-friendly electrical steel.
• Continuous advancements in developing innovative products and manufacturing processes such as Spatially Optimized Diffusion Alloying (SODA) technology for improving the properties of electrical steel.
• Surging investments in renewable energy sources like solar and wind power are driving the demand for electrical steel which is a key material in generators of wind turbines and in transformers facilitating the efficient transmission of power and supply from renewable energy plants.
• Development of advanced and effective coatings providing insulation and tension like for grain-oriented electrical steel (GOES). The coatings improve the efficiency of electrical devices by reducing power loss and magnetostriction.

Market Scope

Segment Insights

Type Insights

Application Insights

Which Application Segment Held the Largest Share of the Electrical Steel Market in 2025?

The transformers segment held the largest share of the market in 2025. This is due to the growing need for energy-efficient transformers, rising investments in electrical infrastructure, and the growth of the automotive sector. By reducing losses and heat generation, oriented electrical steel helps prolong the lifespan of transformers. This minimizes maintenance costs and enhances reliability in electrical grids.

The motors segment is anticipated to grow at the fastest rate during the forecast period. Electrical steel is used in motor designs mainly due to its unique magnetic and electrical properties, which contribute to higher motor efficiency. The demand for electric motors will rise as there is an increase in the penetration of electric vehicles across many developed and developing regions in the world. Electrical steel is a necessity for the electric motors used to power EVs.

End User Insights

Why Did the Energy Segment Dominate the Electrical Steel Market in 2025?

The energy segment held the largest share of the market in 2025. This is due to the shift towards low-carbon and electrified infrastructures in the global electrical systems. A rising number of investments will be made in renewable energy projects, including wind and solar, thereby developing strong demand for high-voltage electrical steels for use in generators, transformers, and grids. There is a rising need to manage variable power generation and maintain grid stability. Thus, manufacturers are advancing their production of next-generation electrical products with significant magnetic properties.

The automotive segment is anticipated to grow at the fastest rate in the coming years. This is due to the fact that the use of electrical steel in automobiles increases fuel efficiency. Due to the growing demand for electric and hybrid vehicles, which increases demand for electrical steel in the automotive industry. Electrical steels are used in every part of a modern vehicle, from the small motors that drive mirrors and seats to the larger machines that are used in the propulsion systems of hybrid or full EVs.

Regional Insights

What is the Asia Pacific Electrical Steel Market Size?

The Asia Pacific electrical steel market size was evaluated at USD 38.89 billion in 2026 and is predicted to be worth around USD 72.21 billion by 2035, rising at a CAGR of 7.11% from 2026 to 2035.

The Asia Pacific market is anticipated to have the fastest growth in terms of volume and in terms of revenue when it comes to the electrical steel market. The reasons for the growth of the electrical steel market in this region is the existence of the largest market for power Transformers. There is a great demand for power Transformers in many nations like China India in Indonesia in the Asia Pacific region. China is one of the largest manufacturers of the power Transformers across the globe. India is also expected to have a growth at a considerable rate due to various factors like growing demand for renewable energy sector, increased demand for energy and increase in the population and urbanization.

China Market Trends
China's market is driven by the availability of steel manufacturing capabilities, a thriving transformer industry, and investments made by the nation in renewable energy. Growth in electric vehicle manufacturing, industrial infrastructure development, and increased electricity demand boosted the consumption of electrical steel products in the region.

What are the Advancements in the Electrical Steel Industry in Europe?

The European electrical steel market also holds a significant share in the overall industry and it is expected to see a substantial growth in the future. due to the proliferating automotive and manufacturing sectors in the European region the demand for this product is expected to grow. Germany dominates the domestic automotive market in the European region as it has leading automotive producers. Due to an increased emphasis on electrification of the vehicles the demand for automotive motors will boost this region's market growth.

Germany Trends

The country's growth and development are driven by its strong manufacturing base and increasing investments being made in renewable energy. The demand for high-performance electrical steel is further being fueled by the region's stringent regulations, which are aimed at improving energy efficiency in various industrial applications.

What Are the Key Trends in the North American Electrical Steel Market?

The North American electrical steel market is expected to witness significant growth over the forecast period. The machinery and automotive sectors are major contributors to demand, as electrical steel is essential for manufacturing power generators, electric motors, and transformers. Also, investments in infrastructure enhancements and modernization projects throughout North America, from smart grids to renewable energy integration, are expected to propel the market.

The expansion of the automotive sector and the market for electric and hybrid vehicles is increasing demand for intricate electrical steel grades utilized in motors and generators, propelling growth. The application of electrical steel in the U.S. machinery sector is extensive, primarily serving to manufacture transformers, motors, and industrial equipment, leading to considerable consumption of electrical steel.

U.S. Market Trends

The U.S. market is driven by high production levels of electric cars, the installation of renewable energy sources, and grid modernization projects. Increased requirements for efficient transformers, motors, and industrial electrical equipment boosted the market for electrical steel in the country.

What are the Key Trends in the Electrical Steel Industry in Latin America?

Latin America is expected to witness substantial growth in the market. This growth is driven by rapid industrialization, urbanization, and increasing investments in renewable energy projects. Countries such as Brazil and Mexico are leading players as they are actively focusing on enhancing their manufacturing capabilities, supported by government initiatives aimed at propelling the electrical steel sector. The demand for high-efficiency electrical steel is also rising due to the growing electric vehicle market.

Brazil Electrical Steel Market Trends

The country is witnessing steady growth, supported by infrastructure development, increasing power generation capacity, and rising adoption of electric vehicles. The region's electrical steel market is further strengthened by government initiatives such as domestic manufacturing incentives and investments in renewable energy and transmission infrastructure.

How is the Electrical Steel Industry Growing in the Middle East and Africa?

The Middle East and Africa are expected to have steady growth throughout the forecast period. This is because the region is witnessing increasing investments in infrastructure and energy projects, which are driving demand for electrical steel. Regulatory frameworks aimed at enhancing energy efficiency and sustainability are also gaining traction, providing a fertile environment for market growth. The focus on renewable energy sources is expected to further boost demand in the coming years. Leading players include South Africa and the UAE.

Saudi Arabia Electrical Steel Market Trends

The country's market landscape still appears to be evolving, with both local and international players competing for market share. As the region continues to develop its industrial capabilities, the presence of key players is expected to grow, pushing the market forward.

Trade Analysis of the Electrical Steel Market

• The world exported 17,972 shipments of electrical steel from July 2024 to June 2025 through 1,278 exporters and 1,563 importers.
• Russia, China, and South Korea were the leading exporters of electrical steel, accounting for 26,075, 13,094, and 4,885 shipments, respectively.
• The top-three importing countries were India, the U.S., and Turkey.
• Top-performing global electrical steel exporters by volume were LLC Viz-Steel, Novolipetsk Steel pl., and POSCO.

Supply Chain Analysis-Electrical Steel Market

• Raw Material Sourcing: The initial stage deals with sourcing raw materials needed to produce electrical steel, such as iron ore, coking coal, scrap steel, and other alloy elements.
  Key Players: Nippon, Tata, Vale
• Manufacturing Process: In this stage, the raw materials are hot or cold rolled, annealed, and then coated to produce electrical steel, based on grain orientation or non-grain orientation.
  Key Players: POSCO, Nippon, Tata
• Distribution Process: The finished electrical steel is packaged and supplied to transformer manufacturers, motor producers, generator manufacturers, and power equipment companies.
  Key Players: Siemens, ABB, Hitachi

Electrical Steel Market Top Companies

• ArcelorMittal (Luxembourg): Produces highly advanced grain-oriented and non-grain-oriented electric steels for use in electric motors, transformers, and efficient energy industries.
• Voestalpine AG (Austria): Provides electrical steel products that are highly efficient and effective in terms of magnetism for use in automotive, renewable energy, and transformer industries.
• Tata Steel Limited: Provides electrical steel products that can be used in power distribution, transformers, and the automotive industries to save energy.
• Thyssenkrupp AG: Produces premium electrical steel products that are designed specifically for use in sustainable electric mobility, industrial motors, and energy systems.
• JFE Steel Corporation: Provides premium electrical steel products for transformers and electric motors that feature low core loss.
• Baosteel: Provides various electrical steel products for electric vehicles, appliances, and transformers through large-scale production and innovation.

Other Major Key Players

• Nippon Steel & Sumitomo Metal Corporation (Japan)
• United States Steel Corporation (United States)
• POSCO (South Korea)
• SAIL India

Companies positive info

• Benxi Steel Group Co., Ltd. and Shougang Group have made large inroads into China's expanding electrical steel market with the support of the government and large investments in production capacity. The two companies can now meet the expected rising demand for premium electrical steel in China, as applications grow and demand rises for premium electrical steel, especially for power generation and transmission.
• Tata Steel, NIPPON STEEL CORPORATION, and Baosteel Group Corporation will maintain their leadership positions in the Asian markets based on their advanced capabilities and facilities to serve the global demand. These companies are also expanding production and investment in research and development to be able to meet the rising demand from the EV market.

Recent Developments

• In August 2025, A collaboration between India's JSW Steel and Japan's JFE Steel invested $669 million to broaden the production capacity of cold-rolled grain-oriented electrical steel across two Indian plants to meet rising domestic demand.
• In April 2026, ArcelorMittal launched a new phase of its electrical steel project in France with a significant investment of around €500 million, while also receiving approximately €25 million in support from the French government under the France 2030 program. (Source: https://gmk.center )
• In February 2025, ArcelorMittal, a globally leading steel producer, announced investment of $1.2 billion into a cutting-edge facility at Mobile County, Alabama. The new plant will manufacture non-grain-oriented electrical steel (NOES) which is a key material utilized in renewable energy production, electric vehicle (EV motors) and industrial applications with an estimated capacity of producing up to 150,000 metric tons of NOES per year, subject to product mix.
• In January 2025, Jsquare Electrical Steel Nashik Private Limited, a wholly owned subsidiary of JSW Steel successfully completed Rs. 4,158 crore acquisition of thyssenkrupp Electrical Steel India Private Limited (tkES India). The acquisition focuses on production of granular electrical steel (GOES) with the goal of meeting the medium and long-term demand for GOES in India.
• In January 2025, Steel Authority of India Limited (SAIL), the state-owned steelmaker and John Cockerill India (JCIL), a technology firm, announced plans for investing around $692 million for setting up a downstream plant producing cold-rolled grain-oriented (CRGO) and cold-rolled non-oriented (CRNO) electrical steel. The new manufacturing plant scheduled for completion in 2027-2029, seeks to achieve 1.5 million tons of production volume annually.

Segments Covered in the Report

By Type

• Grain-oriented
• Non-grain-oriented
  • Fully-Processed
  • Semi-Processed

By Application

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

By End-User

• Energy
• Automotive
• Household Appliances
• Manufacturing
• Others

By Region

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