This growth will see the market value increase from US$40.7 billion in 2024 to US$67.9 billion by 2031. The market's expansion is driven by rising demand for energy efficiency across industries.

Countries' substantial investments in expanding and modernizing power infrastructure lead to a surge in demand for electrical equipment and transformers, thereby boosting the need for electrical steel studied by Persistence Market Research. Additionally, the growing adoption of renewable energy sources such as solar and wind power further fuels market expansion.

Key market growth factors

As nations invest significantly in expanding and modernizing their power infrastructures, the demand for electrical equipment and transformers surges, consequently increasing the need for electrical steel. 

Additionally, the market benefits from the rising adoption of renewable energy sources like solar and wind power, which further boosts demand for electrical steel in various applications. 

Market Restraints

Despite its promising growth trajectory, the global electrical steel market faces certain restraints that may hinder its expansion. One significant restraint is the volatility in raw material prices, particularly those of key components used in the production of electrical steel. Fluctuations in raw material costs can impact the overall profitability of manufacturers and disrupt supply chains. Additionally, stringent environmental regulations and sustainability concerns pose challenges for the industry, requiring manufacturers to invest in eco-friendly production processes and materials, which may entail increased costs. 

Moreover, geopolitical tensions and trade conflicts can disrupt global supply chains and affect market dynamics. 

Lastly, the market may also face challenges related to technological advancements and innovations in alternative materials, which could potentially offer competition to traditional electrical steel products. 

Opportunities

As governments and industries prioritize sustainability and seek to reduce energy losses, there is a growing need for advanced electrical steel products that can enhance the efficiency of power generation, distribution, and consumption.

Furthermore, the ongoing transition towards renewable energy sources presents a lucrative opportunity for electrical steel manufacturers. Solar and wind power installations require transformers and other electrical equipment, driving demand for specialized electrical steel with high magnetic permeability and low energy losses.

Moreover, the expansion of electric vehicle (EV) manufacturing presents a burgeoning opportunity for the electrical steel market. Electric motors and powertrains in EVs rely on high-performance electrical steel to ensure optimal efficiency and performance. 

Top Regional Markets

East Asia, led by economic powerhouses like South Korea, Japan, and China, commands the largest market share in the global electrical steel industry. China, in particular, stands out as the top consumer and producer of electrical steel due to its booming manufacturing sector, rapid urbanization, and growing energy needs. The region's focus on technological advancements and smart grid integration further boosts demand for electrical steel across various applications, solidifying