• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 25 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 7 hours How Far Have We Really Gotten With Alternative Energy
  • 9 hours If hydrogen is the answer, you're asking the wrong question
  • 4 days Oil Stocks, Market Direction, Bitcoin, Minerals, Gold, Silver - Technical Trading <--- Chris Vermeulen & Gareth Soloway weigh in
  • 6 days The European Union is exceptional in its political divide. Examples are apparent in Hungary, Slovakia, Sweden, Netherlands, Belarus, Ireland, etc.
  • 22 hours Biden's $2 trillion Plan for Insfrastructure and Jobs
  • 5 days "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
Metal Miner

Metal Miner

MetalMiner is the largest metals-related media site in the US according to third party ranking sites. With a preemptive global perspective on the issues, trends,…

More Info

Premium Content

Global Energy Transition Fuels Boom In Specialty Steel Demand

  • The global energy transition is fueling a spike in specialty steel demand.
  • India is looking to capitalize on this emerging market while reducing its dependence on materials from Japan and South Korea.
  • New steel technologies require significant R&D, but a few countries, including India, are already ahead in the race.

Via AG Metal Miner

 

New-age steel technologies are exclusive to a select few nations around the world. For this reason, they can only be acquired with significant domestic R&D expenditures or from those countries that already possess them. Either way, these technologies are critical for producing specialized steel products. Among these are automobile-grade continuous annealed products (AGCAP), non-oriented electrical steel sheet, and grain oriented electrical steel.

Electrical steel is essential to the ongoing renewable energy transition. However, future growth in the utilization of renewable energy sources will make such steel and its procurement even more challenging. Grain oriented electrical steel (GOES), for example, is a much sought-after commodity in the world today. This is because it is a crucial component in electrical transformers, which remain vital for the effective conversion, transfer, and utilization of electricity.

Unfortunately, there are already shortages of GOES in many countries, including the U.S. Understanding its importance, countries like India and China are racing to develop indigenous capacities and cut reliance on imports.

India Making New Strides in Specialty Steel

The Indian Government recently established goals to increase productivity, modernize its power grid, and provide affordable electricity to all families. In this current market, these goals only continue to become more relevant. Indeed, India uses about 1,200 kWh of power per person per year. This is far less than the 2,700 kWh global average. However, meeting the growing demand for power and strong grid infrastructure for 1.4 billion people is no simple task. Going forward, it will require a massive investment in transformers. These, in turn, will require grain oriented electrical steel.

Incidentally, India has one of the highest transformer failure rates in the world. Averaging in at around 25%, the failure rate is significantly higher than the global average of 5%. So, with all these factors in mind, the GoI has stepped up its GOES game in recent years. In July 2021, the Indian Government announced the Production-Linked Incentive (PLI) scheme for manufacturing high-grade specialty steel. The initiative is just one part of the ongoing “Make in India” policy. The PLI has a budgetary approval of about US $848.93 million (Rs 63.22 billion), and the scheme will be implemented over five years. The initiative also extends to the production of domestic grain oriented electrical steel.

This means that steel companies like Tata Steel and JSW Steel can now explore new opportunities to make and sell high-value steel products. Ultimately, the aim is to cut down India’s dependence on GOES supplies from Korea, Japan, and China.

India Could Become a Grain Oriented Electrical Steel Powerhouse

Thyssenkrupp became the first manufacturer of grain-oriented electrical steel in India when its JV plant became operational in 2018. A collaboration with Tata Steel, the 35,000-ton-per-year facility includes a magnesium oxide coating line and a laser system for high-quality surface treatment. It is also important to note that two-thirds of the company’s order sheet are Indian customers.

So far, India’s new plan has recently received attention from several foreign steel companies. In the closing days of 2022, Japan’s JFE Steel said it would soon decide on a joint venture in India with partner JSW Steel. The announcement stated that the goal was to produce electrical steel sheet used in power plant transformers.

JFE President Koji Kakigi said the company was also thinking of developing a business in the higher-end field. In this case, the objective would be to create demand for a grain oriented electrical steel sheet together with JSW.

The way things are going, India may emerge as a powerhouse in the next few years. This would apply to not only GOES, but also other high-valued steel products as well. Of course, if the country’s transformer failure rate came down, that would be the icing on the cake.

ADVERTISEMENT

By Sohrab Darabshaw

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News