Grain Oriented Electrical Steel Market Size, Share, Growth, and Industry Analysis, By Type (High Magnetic Strength,Conventional), By Application (Transformer,Motor,Others), Regional Insights and Forecast to 2033

Grain Oriented Electrical Steel Market Overview

The Grain Oriented Electrical Steel Market size was valued at USD 7056.1 million in 2024 and is expected to reach USD 9346.91 million by 2033, growing at a CAGR of 3.2% from 2025 to 2033.

The Grain Oriented Electrical Steel (GOES) Market plays a pivotal role in the global electrical and energy sector due to its superior magnetic properties and efficiency in energy transmission. This material is primarily used in manufacturing transformer cores and high-performance electrical devices where minimized energy loss is essential. In 2023, global consumption of grain oriented electrical steel surpassed 3.1 million metric tons, with the Asia-Pacific region alone accounting for over 45% of total demand. Power distribution and grid expansion projects significantly influence market growth.

Approximately 70% of GOES is consumed in power transformers and large distribution transformers. High magnetic permeability, low core loss, and improved surface insulation resistance have led to its increasing adoption in smart grid infrastructure and high-voltage transmission networks. China, the United States, Germany, and Japan are among the top consumers and producers, with China producing more than 1.2 million metric tons of GOES annually.

The adoption of energy-efficient transformers in urban areas, especially across Asia and Europe, has boosted the market. New regulatory frameworks requiring reduction of transmission losses are prompting utility companies to invest in grain oriented steel-based equipment. Innovations such as laser-scribed GOES are gaining traction due to their performance advantages.

Key Findings

DRIVER: Increasing demand for high-efficiency power transformers in renewable and conventional energy sectors.

COUNTRY/REGION: China leads the global market, with over 1.2 million metric tons of production in 2023.

SEGMENT: Transformer application segment dominates with a 70% share in total global consumption.

Grain Oriented Electrical Steel Market Trends

The grain oriented electrical steel market is undergoing significant transformations driven by the rising global emphasis on sustainable and efficient energy transmission systems. One of the most prominent trends is the growing use of GOES in ultra-high-voltage (UHV) transformers. In 2023, global UHV transformer deployment exceeded 1,000 units, with 82% using GOES in their core structure to reduce core losses below 0.90 W/kg. Countries like China, South Korea, and India have aggressively adopted UHV technologies to improve cross-region power distribution.

Another critical trend is the development of laser-scribed grain oriented electrical steel. This variant exhibits core loss reduction of up to 15% compared to conventional GOES, leading to improved transformer efficiency. As of 2024, approximately 9% of total GOES output is laser-scribed, predominantly in Japan and South Korea. The market is also seeing investments in the development of thin-gauge GOES for compact transformer applications. These thin-gauge variants have thicknesses below 0.23 mm and allow more efficient magnetization at lower operating voltages.

Electrification of transport infrastructure is also a growing trend. Electric railway networks in Europe and Asia are increasingly employing GOES-based systems. In 2023, over 22,000 kilometers of electrified rail lines used GOES transformers. This represents a 14% increase compared to 2021.

Additionally, global focus on reducing carbon emissions from power distribution systems has driven governments to introduce stricter energy-efficiency regulations for transformers. For instance, the European Union's 2023 Tier 2 EcoDesign regulation enforces lower maximum loss limits, compelling utilities to upgrade transformer infrastructure using high-quality GOES.

Grain Oriented Electrical Steel Market Dynamics

Market dynamics refer to the forces that influence the behavior, structure, and performance of the grain oriented electrical steel (GOES) market over time. These dynamics include four core components: drivers, restraints, opportunities, and challenges. Each component plays a vital role in shaping supply-demand conditions, technological advancements, pricing trends, and strategic decisions in the market.

DRIVER

Rising demand for power-efficient transformers in renewable energy transmission

As renewable energy installations expand globally, the requirement for highly efficient transformers has intensified. In 2023, global installed renewable energy capacity surpassed 3,370 GW, with 55% of new capacity additions depending on high-efficiency grid components. Grain oriented electrical steel plays a critical role in reducing no-load losses in these transformers, thus improving overall energy efficiency. With offshore wind projects scaling up in Europe and Asia, demand for large, efficient step-up transformers using GOES has increased by 21% year-on-year.

RESTRAINT

High production cost and limited raw material availability

One of the primary restraints in the GOES market is the complex manufacturing process and dependency on specific alloys, particularly high-purity silicon steel. Producing high-grade GOES requires multiple heat treatments, tight grain orientation control, and precise laser scribing—all of which elevate costs. In 2023, average production costs of high-grade GOES reached $1,300 per metric ton, almost 30% higher than non-oriented electrical steel. Additionally, sourcing iron ore with precise chemical compositions for silicon steel has been difficult due to geopolitical tensions impacting supply chains from Brazil and Ukraine.

OPPORTUNITY

Expansion of smart grids and UHV power transmission

Governments worldwide are investing heavily in smart grid infrastructure. As of 2023, over 91 countries had initiated national-level smart grid plans. These infrastructures rely on highly efficient and reliable transformers, most of which employ grain oriented electrical steel in their cores. In India, the Green Energy Corridor Phase II project aims to deploy over 10,000 MW of renewable power, requiring an estimated 80,000 metric tons of GOES for transformer deployment. Similarly, the U.S. Department of Energy allocated $3.5 billion in 2023 toward grid modernization projects that mandate high-efficiency transformer systems.

CHALLENGE

Substitution threat from amorphous and nanocrystalline materials

Emerging materials like amorphous metal and nanocrystalline alloys are increasingly viewed as alternatives to GOES in transformer cores due to their lower core losses. In 2023, global amorphous steel consumption in transformer cores reached 150,000 metric tons, up from 90,000 metric tons in 2020. Companies are gradually exploring these materials for low-voltage distribution transformers, posing a challenge to GOES manufacturers. While GOES still dominates high-voltage and precision applications, ongoing R&D in amorphous alloys may encroach on traditional market share.

Grain Oriented Electrical Steel Market Segmentation

The grain oriented electrical steel market is segmented based on type and application. These segments cater to a range of industries and utility-grade projects. By type, the market is classified into High Magnetic Strength and Conventional GOES. By application, the major segments include Transformer, Motor, and Others.

By Type

• High Magnetic Strength: High magnetic strength GOES is engineered for precision applications requiring maximum flux density and minimal hysteresis loss. In 2023, over 820,000 metric tons of this type were used in high-voltage transformers alone. It enables magnetic induction values over 1.9 Tesla and is favored in grid-scale transmission projects. Japan and Germany are major producers of high magnetic strength GOES, exporting over 210,000 metric tons annually combined.
• Conventional: Conventional GOES represents the standard electrical steel used in most distribution and industrial transformers. As of 2023, this type accounted for 62% of total global GOES production. It offers stable magnetic characteristics with acceptable core loss and is widely used in general-purpose applications. China produced more than 900,000 metric tons of conventional GOES, supplying both domestic and export markets.

By Application

• Transformer: The transformer segment leads with over 2.1 million metric tons of GOES consumption in 2023. This includes use in power transformers, distribution transformers, and instrument transformers. The increasing replacement rate of aging transformers in North America and the EU fuels demand.
• Motor: GOES usage in electric motors is limited but growing in specialized applications such as servo motors and traction motors. Around 210,000 metric tons were used in motor manufacturing globally in 2023.
• Others: Miscellaneous uses, including sensors, reactors, and magnetic shielding, contributed approximately 150,000 metric tons in 2023. These are niche markets with customized GOES specifications.

Regional Outlook for the Grain Oriented Electrical Steel Market

Global market performance shows varied trends across regions, influenced by energy infrastructure, regulatory frameworks, and industrial development.

• North America

North America accounted for over 18% of global GOES demand in 2023. The United States used more than 520,000 metric tons, largely for power grid modernization under the Infrastructure Investment and Jobs Act. Canada’s aging transformer fleet, with over 43% above 30 years old, is also driving market demand.

• Europe

Europe's GOES market is driven by eco-friendly transformer mandates under the EU's EcoDesign Directive. In 2023, Germany consumed approximately 370,000 metric tons of GOES. France, Italy, and the UK collectively contributed another 410,000 metric tons. The emphasis on replacing old power infrastructure has increased import volumes.

• Asia-Pacific

Asia-Pacific leads globally, with 47% of the total demand. China alone produced over 1.2 million metric tons of GOES in 2023, followed by Japan and South Korea. India’s renewable energy expansion has increased its consumption to 210,000 metric tons, with further growth projected due to electrification projects in rural areas.

• Middle East & Africa

Middle East & Africa region is an emerging market. In 2023, the region consumed 140,000 metric tons, with Saudi Arabia and South Africa being major importers. Projects like the $500 million Saudi Electricity Company’s grid expansion plan are expected to boost demand.

List of Top Grain Oriented Electrical Steel Companies

• Baowu Group
• NLMK
• Nippon Steel
• AK Steel (Cleveland-Cliffs)
• Shougang
• Posco
• JFE Steel
• ThyssenKrupp
• Stalprodukt S.A.
• Baotou Weifeng Rare Earth Electromagnetic Materials Co., Ltd.
• Aperam
• Chongqing Wangbian Electric (Group) Corp., Ltd.
• Yinyi Group
• Zhejiang Huaying New Material Technology Co., Ltd.
• Wuxi Huajing New Materials Co., Ltd.
• New Wanxin (Fujian) Precision Small Board Co.,Ltd.
• Guangdong Yingquan High-tech New Material Co., Ltd.
• Wuxi Win steel Technology Co., Ltd.

Baowu Group: Leading producer with over 1.15 million metric tons of GOES output in 2023.

NLMK: Produced approximately 630,000 metric tons of GOES, with exports to over 30 countries.

Investment Analysis and Opportunities

The grain oriented electrical steel market is witnessing robust capital infusion in production technology, energy infrastructure, and strategic partnerships. In 2023, more than $2.1 billion was invested globally in expanding GOES production capacity. For example, Baowu Group initiated a new high-magnetic GOES production line with a capacity of 320,000 metric tons annually, expected to be operational by Q3 2025.

Investments are also rising in downstream transformer manufacturing. In India, over $500 million was allocated to build new GOES-core transformer units under the “Make in India” initiative. Similarly, the European Union allocated $1.8 billion in 2023 to energy efficiency transformation, with a significant share for transformer infrastructure upgrades using GOES.

Innovation-focused investments are gaining momentum. Companies like Nippon Steel and POSCO are spending over $180 million on R&D into thinner and higher-efficiency GOES variants. The objective is to reduce thickness from the current 0.23 mm to 0.18 mm without compromising magnetic performance.

Private equity firms are also entering the market. For example, in 2023, Blue Horizon Capital invested $90 million in Wuxi Huajing New Materials to expand high-grade GOES production. Government policy incentives, such as production-linked incentive (PLI) schemes in Asia, are catalyzing local manufacturing investments.

New Product Development

The grain oriented electrical steel market is undergoing a wave of product innovations to meet evolving transformer performance standards. One major development is laser-scribed GOES, which offers 12%–18% lower core loss than traditional GOES. Companies like JFE Steel and ThyssenKrupp have introduced this variant in high-voltage transmission transformers.

In 2023, Aperam launched its next-gen GOES grade with magnetic permeability above 1.95 Tesla, designed specifically for UHV transformers. The new product has been adopted in smart grid installations across France and Belgium.

Japanese manufacturers, such as Nippon Steel, have developed ultra-thin GOES with a thickness of 0.18 mm. This steel variant is now used in compact transformers for EV charging stations. Around 65% of newly installed EV charging points in Japan incorporated this material by the end of 2023.

Advanced coating technologies are also emerging. Stalprodukt S.A. introduced a double-layer insulation coating on GOES, improving oxidation resistance and reducing eddy current loss by 9%. The product is currently being piloted in wind power transformers in Eastern Europe.

Five Recent Developments

• In Q2 2023, Baowu Group added a 280,000 metric ton high-grade GOES production line in Anhui, China.
• In August 2023, NLMK launched a new GOES processing center in India to cater to the South Asian market.
• ThyssenKrupp, in January 2024, unveiled a laser-etched GOES sheet with 14% reduced core loss.
• POSCO, in March 2023, signed a partnership with LG Energy to supply GOES for renewable storage grid transformers.
• JFE Steel, in November 2023, introduced a new coating process for GOES to improve energy efficiency in offshore wind applications.

Report Coverage of Grain Oriented Electrical Steel Market

This report on the grain oriented electrical steel market encompasses a detailed examination of market dynamics, segmentation, and competitive landscape. It focuses on factors such as product innovation, regional performance, manufacturing capacity, and application trends across industries like power transmission, transportation, and industrial automation.

The analysis includes global and regional consumption data, highlighting differences in GOES grades such as high magnetic strength and conventional steel. The report also explores usage across transformer, motor, and miscellaneous applications, with figures supporting each category’s contribution to overall market size. The study includes supply chain assessments, including raw material sourcing and downstream transformer manufacturing.

Through comprehensive company profiling, the report provides an overview of the top 18 market players, emphasizing production capacities and geographical outreach. Furthermore, the report discusses technological advancements such as laser scribing and ultra-thin GOES, which are redefining transformer efficiency standards. Strategic investments and capital expenditures are mapped with numerical values to show current and projected production capacity enhancements.

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