Grain Oriented Electrical Steel Sheet Market Size, Trends

Grain Oriented Electrical Steel Sheet Market Overview

Global grain oriented electrical steel sheet market size is estimated at USD 7081.61 million in 2024 and expected to rise to USD 8518.1 million by 2033, experiencing a CAGR of 2.1%.

The grain oriented electrical steel sheet market is a crucial segment within the electrical materials industry, with its products primarily used in power transformers and distribution networks. Globally, over 2.4 million metric tons of grain oriented electrical steel sheets are consumed annually, supporting the global grid infrastructure across more than 100 countries. These specialized steel sheets exhibit a high magnetic flux density of 1.89 Tesla and low core loss below 1.0 W/kg at 1.7 Tesla, making them vital for energy-efficient transformers.

With over 65% of global electricity passing through transformers utilizing grain oriented electrical steel sheets, the material’s importance is underscored by its direct impact on energy transmission efficiency. Countries such as China, India, Germany, and the United States each contribute over 120,000 metric tons in annual consumption. The market is also evolving with improved domain refinement techniques, bringing down noise levels in power transformers by 20 decibels in large installations. Additionally, the demand for energy-efficient transformers increased by 18% year-on-year due to power infrastructure upgrades in emerging economies. This growth correlates with a 25% increase in manufacturing capacity expansion projects across Asia-Pacific in 2023.

Key Findings

Top Driver reason: Surge in power grid modernization projects globally is propelling demand for grain oriented electrical steel sheets.

Top Country/Region: Asia-Pacific leads with more than 1.1 million metric tons of consumption annually, dominated by China and India.

Top Segment: Transformer applications dominate, accounting for more than 1.6 million metric tons of total usage.

Grain Oriented Electrical Steel Sheet Market Trends

One significant trend in the grain oriented electrical steel sheet market is the increasing preference for high-grade sheets such as HiB (high permeability grain oriented steel), which offer a reduction in core loss by 15% and improve transformer efficiency. In 2023, over 720,000 metric tons of HiB grade were produced globally, a 12% increase from the previous year. This surge is attributed to stringent efficiency regulations in Europe and Japan mandating core loss limits below 0.90 W/kg at 1.7 Tesla.

Another emerging trend is the integration of grain oriented electrical steel sheets in renewable energy installations. Wind power generation infrastructure accounted for nearly 8% of the global demand, which equates to over 190,000 metric tons of grain oriented steel used in wind farm transformers. In the same period, solar installations required over 85,000 metric tons, a 22% rise from 2022 due to utility-scale projects in India and Southeast Asia.

Digital grid expansion is also driving consumption. Smart transformers incorporating grain oriented electrical steel are now deployed in 56% of new grid installations across urban centers. This modernization contributed to an increase of over 210,000 metric tons in 2023 demand, mostly across metropolitan transmission utilities.

Additionally, localized manufacturing hubs in Vietnam, Indonesia, and Turkey are gaining momentum, with combined annual production crossing 140,000 metric tons in 2023. These countries saw an average of 18% year-on-year growth due to favorable tariffs and rising domestic transformer production. The usage of laser scribing and magnetic domain refinement technology also increased by 28% globally in production lines to further reduce losses.

Grain Oriented Electrical Steel Sheet Market Dynamics

DRIVER

Increasing deployment of power and distribution transformers in utility infrastructure.

The power grid expansion and modernization projects in over 75 countries have increased the demand for energy-efficient transformers utilizing grain oriented electrical steel sheets. In 2023 alone, more than 680 new substations were commissioned globally, each requiring up to 2,000 kg of grain oriented electrical steel sheets for core assembly. India’s national grid upgrade consumed 165,000 metric tons, while the U.S. grid overhaul utilized 135,000 metric tons in just one year. This upsurge in demand has been amplified by a 20% increase in rural electrification efforts across Africa, which used over 70,000 metric tons of material in 2023.

RESTRAINT

Limited availability of high-purity raw materials required for steel processing.

The production of grain oriented electrical steel sheets requires iron with less than 0.005% sulfur and less than 0.003% nitrogen content, making raw material sourcing a complex challenge. In 2023, over 18% of production delays were attributed to raw material shortages, particularly in countries with restricted access to high-grade ore and processing facilities. Additionally, only five countries produce the majority of laser-scribed steel blanks, with a production bottleneck of 92,000 metric tons reported in Q2 2023 alone, stalling supply chains.

OPPORTUNITY

Growth in electrification of transport and renewable energy systems.

The electrification of railways, metros, and electric buses increased demand for compact transformers that rely on grain oriented electrical steel. Over 2,100 new electric train coaches deployed globally in 2023 required more than 4,200 metric tons of such steel. Similarly, offshore wind farms in Europe consumed 48,000 metric tons of grain oriented steel for power transmission transformers. The rise of renewable energy integration into grids presents an opportunity to penetrate new markets like Latin America, where transformer infrastructure investment rose by 31% year-on-year.

CHALLENGE

High processing cost due to multi-step annealing and domain refinement processes.

The cost of producing grain oriented electrical steel sheets remains high due to extensive cold rolling, decarburization, and magnetic domain refinement steps. Each metric ton requires up to 19 processing steps and consumes more than 280 kWh of energy. Additionally, specialty coatings applied to enhance insulation increase per-ton manufacturing costs by 8%-12%. In 2023, production cost fluctuations of up to 21% were observed across different regions, primarily due to volatility in energy prices and import tariffs on specialty alloys.

Grain Oriented Electrical Steel Sheet Market Segmentation

The grain oriented electrical steel sheet market is segmented by type and application. By type, the two dominant categories are Thin Type and Ultra-Thin Type. By application, the major use cases include transformers, electric motors, power generators, and other electrical equipment. Each segment contributes differently to overall demand, based on end-use industries and regulatory energy efficiency requirements.

By Type

Thin Type: Thin-type grain oriented electrical steel sheets, typically ranging between 0.23mm to 0.27mm in thickness, represent over 1.6 million metric tons of the global market. These sheets are widely adopted in distribution transformers and exhibit core loss levels between 1.00–1.20 W/kg at 1.7 Tesla. Over 120 production facilities globally specialize in thin-type manufacturing, with China alone accounting for 490,000 metric tons in 2023. These sheets are cost-effective and used in over 60% of all transformer cores manufactured annually.
Ultra-Thin Type: Ultra-thin grain oriented electrical steel sheets, with thicknesses below 0.20mm, are gaining popularity for high-frequency and compact transformer applications. In 2023, around 450,000 metric tons of ultra-thin sheets were produced, with Japan, Germany, and South Korea being leading contributors. These sheets achieve up to 0.85 W/kg in core losses and are deployed in smart grids, power electronics, and electric vehicle transformer systems. The use of ultra-thin sheets grew by 24% year-on-year due to miniaturization trends in transformer design.

By Application

Transformer: Transformers remain the leading application segment, consuming more than 1.6 million metric tons annually. Over 3.4 million new transformers were installed in 2023, each using an average of 32 kg of grain oriented steel sheet. Power utility companies in Europe, the U.S., and China account for over 68% of transformer segment demand.
Power Generator: Grain oriented electrical steel sheets used in power generators accounted for nearly 320,000 metric tons in 2023. These are used in gas turbines and renewable power generation systems, especially in 500MW-class generator units where core loss reductions can improve efficiency by 2%.
Electric Motor: Although less common, over 190,000 metric tons of grain oriented steel were used in synchronous and induction motors in 2023. These are mainly specialized applications requiring low loss operation at low frequencies, with a rising trend in electric industrial drive systems.
Other: Other applications include high-precision reactors, magnetic sensors, and specialized choke transformers, with over 100,000 metric tons of demand. These are primarily concentrated in Japan and Germany, supporting the automotive electronics and industrial automation sectors.

Grain Oriented Electrical Steel Sheet Market Regional Outlook

The grain oriented electrical steel sheet market displays strong regional performance variability based on power grid demand, manufacturing capability, and regulatory frameworks.

North America

North America consumed over 420,000 metric tons in 2023, with the United States accounting for 78% of regional demand. Major utilities like those in Texas and California expanded smart grid capacity, leading to a 15% rise in demand. Canada imported 64,000 metric tons due to limited local production, relying heavily on transformers for renewable power integration.

Europe

Europe accounted for 560,000 metric tons, supported by upgrades to aging grid infrastructure in Germany, France, and the UK. Germany alone used 195,000 metric tons in 2023 due to its Energiewende policy. EU-wide energy efficiency directives imposed since 2022 have led to a 20% surge in demand for HiB grade steel in the transformer segment.

Asia-Pacific

Asia-Pacific remains the dominant region with over 1.1 million metric tons of annual consumption. China leads with 620,000 metric tons, followed by India at 190,000 metric tons and Japan at 110,000 metric tons. Rapid urbanization and grid connectivity expansion have driven usage across ASEAN nations, which collectively added over 72,000 metric tons in 2023.

Middle East & Africa

The Middle East and Africa used approximately 210,000 metric tons in 2023. Saudi Arabia and South Africa were the largest consumers, driven by a 17% rise in utility-scale transmission projects. North Africa added 4,200 new transformers requiring 8,000 metric tons of grain oriented steel for national electrification plans.

List of Top Grain Oriented Electrical Steel Sheet Market Companies

Nippon Steel
JFE Steel
Posco
AK Steel
Shougang
Ansteel
Stalprodukt S.A.
NLMK Group
ThyssenKrupp
Tata Steel

Top 2 Companies with Highest Share

Nippon Steel: Nippon Steel produced over 680,000 metric tons of grain oriented electrical steel sheets in 2023, accounting for nearly 23% of global output. Its plants in Japan and India are leading producers of HiB and ultra-thin grades.

JFE Steel: JFE Steel manufactured 510,000 metric tons in 2023, supplying major markets in Japan, South Korea, and Europe. Its domain-refined products have over 97% market acceptance among European transformer manufacturers.

Investment Analysis and Opportunities

The grain oriented electrical steel sheet market has witnessed over $920 million equivalent in capital expenditure in 2023, leading to the addition of more than 420,000 metric tons in global production capacity. A significant portion of this investment—over 38%—was directed toward Asia-Pacific countries, with China and India expanding manufacturing plants by over 280,000 metric tons combined. New downstream investment includes 17 new transformer manufacturing units in Southeast Asia that began operations in 2023, with each facility utilizing 3,500–6,200 metric tons annually.

Europe has emerged as a lucrative investment opportunity due to stricter energy efficiency directives. In 2023, Germany announced an incentive plan worth over €280 million to subsidize manufacturers that produce HiB grain oriented steel sheets, triggering a 13% year-on-year growth in domestic investment. Similarly, Poland saw the establishment of a new 65,000 metric ton facility by a regional producer, targeting both Eastern and Western Europe markets.

In North America, more than 210,000 metric tons of new demand emerged from public infrastructure and renewable energy projects. Texas-based manufacturers invested over $70 million to increase capacity by 24,000 metric tons in response to the regional grid expansion. Canada allocated $38 million to develop domestic processing capabilities, which are expected to reduce dependency on imports by 16% over the next 3 years.

Africa and the Middle East have also opened up investment opportunities, particularly in Egypt, Saudi Arabia, and the UAE, where transformer manufacturing is projected to rise by 28% year-on-year. These regions imported over 180,000 metric tons in 2023, indicating demand gaps that can be fulfilled by regional production hubs.

The global shift to renewable energy, smart grids, and electrification of transportation has created over 620,000 metric tons of new demand space for grain oriented steel sheets in the next 3 years. With more than 190 power utilities announcing grid investment programs exceeding $30 billion equivalent in 2023, the upward trajectory for this material is reinforced by consistent institutional backing.

New Product Development

Recent product innovations in grain oriented electrical steel sheets have revolved around improving magnetic domain refinement, core loss reduction, and insulation coating stability. In 2023, over 420,000 metric tons of HiB and ultra-thin variants with domain refinement technologies were launched globally. These products achieved core losses as low as 0.85 W/kg at 1.7 Tesla, with efficiency improvements of 10–15% in high-performance transformers.

Nippon Steel unveiled a new grade of HiB with a magnetic flux density of 1.92 Tesla and loss of 0.81 W/kg, reducing energy loss in grid transformers by 5%. This product is now used in more than 12 national grid installations in Japan and exported to six countries, contributing over 95,000 metric tons in 2023 sales.

JFE Steel introduced an ultra-thin domain-refined electrical steel that has found use in renewable energy transformer installations across Europe. It enabled a 20% size reduction in transformer design while maintaining the same magnetic performance, reducing space requirements in urban substations by 17%.

Posco launched a specialized coating that increased oxidation resistance by 25%, allowing transformer cores to maintain optimal performance for more than 15 years. This coating was used in over 7,800 transformer cores in South Korea and Vietnam in 2023, totaling more than 43,000 metric tons of application.

Tata Steel invested in R&D to develop a high-temperature grade suitable for desert climates. This new variant can sustain magnetic properties even at ambient temperatures of 55°C and was deployed in grid transformers across the UAE and Oman, covering 9,200 metric tons in pilot production.

AK Steel focused on green production by reducing CO₂ emissions by 28% per metric ton of output in its new grain oriented electrical steel line commissioned in 2023. The plant has a production capacity of 56,000 metric tons and aligns with ESG goals of major utility clients in North America.

Five Recent Developments

Nippon Steel expanded its domain-refined production capacity by 65,000 metric tons in March 2023, bringing total advanced grain oriented electrical steel output to 710,000 metric tons annually.

JFE Steel signed a partnership in September 2023 with a European transformer giant to supply 50,000 metric tons of HiB steel for 2024–2026, marking its largest export deal to date.

Tata Steel commissioned a 45,000 metric ton/year cold rolling facility in Gujarat in April 2024, focused solely on HiB and thin-grade grain oriented electrical steel production.

Posco announced a $210 million investment in its Gwangyang plant in November 2023 to install eco-friendly annealing and decarburization furnaces for cleaner production.

ThyssenKrupp developed a new high-speed slitting line in February 2024 that improved productivity by 22% and enabled production of 0.18mm ultra-thin sheets at 95% efficiency.

Report Coverage of Grain Oriented Electrical Steel Sheet Market

This report comprehensively analyzes the grain oriented electrical steel sheet market across production, consumption, application sectors, innovation cycles, and regional dynamics. Covering data from 2021 through 2024, the report integrates over 600 data points per region to evaluate material flow, investment cycles, and product evolution. It includes detailed quantitative analysis on the production volumes of over 20 manufacturers and regional consumption patterns in 30+ countries, accounting for over 96% of global demand.

The report evaluates thin and ultra-thin variants of grain oriented electrical steel and includes performance metrics such as core loss (W/kg), flux density (Tesla), insulation resistance, and coating type analysis. It provides more than 180 figures across transformer, generator, and motor application demand, with segmentation by unit type, installation size, and voltage rating.

Special emphasis is placed on understanding the effect of regulatory changes such as EU Ecodesign regulations, India’s Bureau of Energy Efficiency standards, and North America’s DOE 10 CFR Part 431 requirements, which directly influence material specifications and demand projections.

The investment section of the report tracks over 90 capital expenditure programs initiated in 2022–2024, totaling over $1.2 billion in capacity expansion, new product development, and sustainability-focused manufacturing upgrades. It also includes forecast models based on infrastructure development rates, electrification roadmaps, and renewable integration targets from national energy policies.

This report serves as a decision-making tool for manufacturers, investors, policymakers, and utility stakeholders by offering 360-degree insight into the grain oriented electrical steel sheet market, backed by numerical detail and strategic forecasts.