Philippines Electrical Steel Market SIZE AND SHARE ANALYSIS - GROWTH TRENDS AND FORECASTS (2024 - 2031)

Philippines Electrical Steel Market Size - Analysis

The Philippines Electrical Steel Market Report is estimated to be valued at USD 103.1 Mn in 2024 and is expected to reach USD 142.1 Mn by 2031, growing at a CAGR of 5.5% from 2024 to 2031.

Philippines Electrical Steel Market Trends

The construction industry in Philippines has been experiencing significant growth over the past few years and this is directly fueling the demand for electrical steel in the country. More construction projects mean higher need for infrastructure which will require electrical components and equipment. Electrical steel is a vital raw material used in production of transformers, motors and generators that provide power in buildings, factories, townships etc.

By 2025, real estate and construction is projected to contribute nearly 13% to the country's GDP as per Philippines Development Plan 2017-2022.

Market Driver – Rising Focus on Renewable Energy

As solar and wind farms increase to meet the rising energy demand, there will be a parallel rise in the need for electrical steel that forms the core component of transformers and generators installed in these renewable energy power projects. Electrical steel is specially produced steel with tight specifications on its magnetic properties to ensure maximum energy efficiency. Both solar farms and wind turbines require step-up transformers to increase the voltage for efficient transmission and distribution.

Market Challenge – Price Volatility of Raw Materials

For example, during the pandemic-induced economic slowdown of 2020-21, lockdowns had sharply reduced demand from key steel consuming industries worldwide. This had led to a crash in international steel and iron ore prices which provided brief relief to Philippines electrical steel makers in terms of reduced raw material costs. However, the situation reversed rapidly in 2022 as post-pandemic economic recovery took hold. Demand for steel shot up from China and other developing nations leading to a price surge, whereas global supply could not keep pace due to production constraints during the pandemic years.

Market Opportunity – Developing Transportation Infrastructure

Electrical steel is a vital material used in equipment related to transportation sector such as electric vehicles, railway tracks, signaling systems etc. The ongoing and planned infrastructure development indicates a steady rise in demand for such equipment. For example, the Department of Transportation aims to construct over 900 Km of rail lines by 2028 under its 'Build, Build, Build' program. This will drive the requirement for electrical steel sheets, rails, transformers and other components used in rail transport.

Segmental Analysis of Philippines Electrical Steel Market

The non-grain oriented sub-segment contributes the largest share of 80.6% in the Philippines electrical steel market due to its widespread versatility and cost-effectiveness. This type of steel does not require a specific grain structure like grain-oriented steel, allowing it to be used in a variety of applications that do not demand ultra-high permeability.

Electric motors incorporating non-grain oriented steel alone account for a huge installed base in the Philippines, both for industrial equipment and consumer durable goods. Steady growth in manufacturing and a burgeoning appliances market contribute to sustained demand. Expanding electrification in rural areas also brings new motor installations.

Of all the key applications for electrical steel in the Philippines, motors sub-segment generates the greatest demand with a market share of 66.6%. Motors are ubiquitous throughout the industrial sector for powering factory equipment like conveyors, production lines, pumps and compressors. They are also essential components running everything from small household fans to large chillers and air conditioners.

Rising investments in industries like food processing, automotive and electronics bolster demand for industrial motors and machinery. At the same time, a growing middle class and expanding infrastructure drive the appliances and HVAC sectors. Motors in public transport and power generation also contribute to the thriving application segment. With such entrenched usage across diverse power requirements, the electric motor segment will remain a pillar propping up electrical steel consumption.

Competitive overview of Philippines Electrical Steel Market

The major players operating in the Philippines Electrical Steel Market Report include Thyssenkrupp, NatSteel Asia, Kewei Steel Group, Nippon Steel Corporation, JFE Steel Corporation, Posco International, Voestalpine AG, and Arcelor Mittal.

Recent Developments in Philippines Electrical Steel Market

Philippines Electrical Steel Market Segmentation

• By Product Type
  • Non-grain Oriented
  • Grain-oriented
• By Application
  • Motors
  • Inductors
  • Transformer