According to the UnivDatos, the global demand for energy-efficient solutions in power infrastructure, electric vehicles, and renewable energy systems will drive the global scenario of the Electrical Steel market. As per their Electrical Steel Market report, the global market was valued at USD 33.4 Billion in 2023, growing at a CAGR of 6.4% during the forecast period from 2024 - 2032 to reach USD Billion by 2032.

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The application of electrical steel in the field of energy efficiency and renewable energy, electric vehicles, and industrial automation is growing, which in turn propels the electrical steel market. Transformers, motors, and generators must have important electrical steel with high magnetic properties to produce them, and this is essential to using power efficiently. Grain oriented electrical steel, which is used in transformers, as well as non grain oriented steel, good for electric motors and rotating machinery, are part of the market. Factors driving the growth include rising electricity demand, rising use of green energy projects and vehicle production everywhere. For the time being, the electrical steel market looks set for strong government support and industry initiatives aimed at cutting carbon emissions while also developing high performance products to meet changing energy demands.

Electrical Steel Overview in APAC

The Asia Pacific (APAC) holds a significant share of the electrical steel market because of a growing focus on rapid industrialization and urbanization together with the booming infrastructural development in the countries like China, India, Japan, and South Korea. With its robust manufacturing base and large investments in renewable energy, electric vehicles and smart grid infrastructure, strong demand for electrical steel exists in transformers, motors and generators, which drives electrical steel demand in APAC. China, as the largest producer and consumer of electrical steel, is a significant player in the market due to its large investment in renewing the country’s power grid and the development of renewables with the help of its five-year plans. India's "Make in India" and its "National Electric Mobility Mission Plan" also boost demand for electrical steel for making infrastructure greener by enhancing the country's effort to shift to sustainable energy solutions.

Government policy across APAC has been a big driver of the electrical steel market. For example, The Green Growth Strategy in Japan, South Korea’s Green New Deal, both stressing carbon neutrality and energy efficiency, spur demand for high performance electrical steel products in the power generation and automotive sectors. In addition to the incentives and regulatory framework for adopting EVs across the region, growth of the non grain oriented electrical steel segment, particularly used in the production of electric motors, is further supported. The electrical steel industry is set for growth, innovation, and technological advancement as APAC economies continue to grow increasingly focused on cleaner energy and more efficient power distribution.

Electrical Steel Market in China

China is a dominant player in the global electrical steel market, driven by its massive industrial base, urbanization efforts, and strong government support for energy-efficient technologies. As the largest producer and consumer of electrical steel, China’s demand is fueled by its ongoing infrastructure projects, expansion of renewable energy, and rising electric vehicle (EV) production. Government policies, such as the “Made in China 2025” initiative and five-year plans, are pushing for advanced manufacturing and energy efficiency, significantly boosting the demand for both grain-oriented and non-grain-oriented electrical steel. The focus on modernizing China’s power grid to support renewable energy integration further enhances the need for high-performance electrical steel in transformers, motors, and other essential equipment. With continuous investments in green technologies and EV incentives, China’s electrical steel market is set for sustained growth, reinforcing its central role in the global landscape.

Key Market Insights on China

China is the largest producer and consumer of electrical steel globally: Electrical steel is demanded by China due to its large manufacturing industry and big-scale infrastructure developments. High production capacity helps the country to satisfy its own demand and foreign requirements and strengthen its position as electricity steel powerhouse.

Government initiatives like “Made in China 2025” and five-year plans prioritize energy efficiency and advanced manufacturing: The Chinese government’s “Made in China 2025 strategy is designed to improve the Chinese manufacturing industry through embracing efficient technology and increased energy efficiency. The five year plans stress on sustainable development and energy efficiencies which means industries are forced to develop and incorporate high technologies hence creating demand for specialized electrical steel products.

Rising demand for electric vehicles (EVs) is driving growth in the non-grain-oriented electrical steel segment: As China has set very high targets for electric mobility It has led to an increased demand for electrical vehicles hence the increased demand for non-grain-oriented electrical steel for use in manufacturing of electric motors. Government subsidies and incentives, increased stringency of emission standards also increases the take rate of EVs, which is augmenting this segment of the electrical steel market.

Extensive infrastructure projects and grid modernization efforts increase demand for grain-oriented electrical steel in transformers: Given the dynamism with which China is currently experiencing the process of urbanization and industrialization its power infrastructure ranging from smart grids to the transmission systems requires constant reinforcements. Electrical steel which features in these upgrades as a material for enhancing efficiency of transformers through reduced energy loss.

The Chinese government’s emphasis on renewable energy integration supports demand for high-performance electrical steel in power distribution: Wind and, in particular, solar power are being invested a lot by China. For such high-performance electrical steel is pertinent to the production of highly efficient energy efficient transformers and distribution equipment for minimizing the power losses and for stabilizing the grid, and also for incorporating into the national grid.

China’s commitment to reducing carbon emissions aligns with its increasing investments in energy-efficient technologies and cleaner energy solutions: China has been supporting the technologies in accord with its carbon neutral plans whose goal is to help save energy and reduce emissions. And it is this commitment that creates a demand for electrical steel – where its crucial applications include energy-efficient motors, transformers, wind and other renewable energy generating factories among others which support China’s green issues and the overall progress of this market.

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Conclusion

Finally, China's electrical steel market has great potential in terms of growth, due to strong government support, rapid industrialization, and the country's determination to cut energy consumption, and reduce carbon emissions. High performance electrical steel is being driven by key initiatives including 'Made in China 2025' and ambitious five year plans, across a variety of applications including electric vehicles, renewable energy integration and infrastructure modernization. With China’s push for renewables and electric mobility, demand for both grain oriented and non grain oriented electrical steel will continue to rise. Befitting China’s status as the world’s largest manufacturer, the country’s plant is able to produce as much steel as it needs to meet domestic consumption while also positioning itself as a pivotal player in the global electrical steel industry. In pursuit of these goals, market factors continue to promote and develop the relevant national, regional and worldwide as a reputable stable and strong leader in the market.

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