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Special Steel Market Overview
The Special Steel Market
size is estimated to reach US$250 billion by 2027, after growing at a CAGR of 4.0%
during the forecast period 2022-2027. Special steel comprises a
different chemical composition, is manufactured by a special process and has
special organization and characteristics to meet special requirements. Special
steels exhibit higher strength, physical and chemical properties,
biocompatibility and process characteristics than ordinary steel. The growing
automotive sector is driving the special steel market growth. It is utilized in
various automotive components and parts. Moreover, there is an increasing requirement
for special steel such as carbon steel, carbon
tool steel, ordinary low-alloy steel, alloy steel for engineering structure,
stainless steel and others. These steels are used in the aerospace & defence industry
for the manufacturing of aircraft structures and parts such as fuel tanks, high-temperature
engine parts, exhaust components, structural parts, cabin components, landing
gears and others. This is anticipated to upsurge the
growth of the special steel industry during the forecast period. The global
economic downturn caused by the COVID-19 pandemic resulted in a huge drop in
building & construction, electronic devices, automotive and other end-use
industries all across the world. It had a significant impact on the growth
of the Special Steel market size.
Special Steel Market Report Coverage
The “Special Steel Market Report – Forecast (2022 - 2027)” by IndustryARC, covers an in-depth analysis of the following segments in the Special Steel industry.
Key Takeaways
- The Asia-pacific region dominates the Special Steel market owing to the rising growth in the electrical and electronics industry. According to the Indian Brand Equity Foundation (IBEF), the Indian electronics manufacturing industry is projected to reach US$520 billion by 2025.
- Rapidly rising demand for Special Steel in the aerospace and defence sector, due to its usage in aircraft components or parts that require high strength, temperature resistance and toughness such as fuel tanks, high-temperature engine parts and others, has driven the growth of the Special Steel market.
- The increasing demand for Special Steel in the automotive sector, due to its usage in the manufacturing of various vehicle components such as door panels, chassis, support beams and others, has been a critical factor driving the growth of the Special Steel market in the upcoming years.
- However, the high manufacturing cost of Special Steel can hinder the growth of the Special Steel market.
Figure: Special Steel Market Revenue Share, by Geography, 2021 (%)
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Special Steel Market Segment Analysis – by Type
The ordinary low-alloy steel segment held the largest Special Steel market share in 2021 and is estimated to grow at a CAGR of 3.9% during the forecast period 2022-2027. Ordinary low-alloy steel comprises a small amount of alloying elements and the strength of the steel is high. It exhibits good corrosion resistance, wear resistance and low-temperature resistance. The overall performance is relatively good and it offers good cutting and welding performance in comparison to other special steel types such as carbon steel, carbon tool steel and others. Ordinary low-alloy steel has a good service life and its use range is more than carbon steel. Ordinary low-alloy steel is smelted in open furnaces by general smelting methods and the price is also low. Thus, all these exhibit characteristics of ordinary low-alloy steel make it a preferred choice over the other Special Steel types which is driving its segmental growth.
Special Steel Market Segment Analysis – by End-use Industry
The building & construction industry held a significant Special Steel market share in 2021 and is projected to grow at a CAGR of 4.5% during the forecast period 2022-2027. In the building & construction industry, special steel such as carbon steel, carbon tool steel, ordinary low-alloy steel, alloy steel for engineering structure, stainless steel and others is utilized to build high-rise buildings, industrial sheds, residential buildings, bridges, parking garages and more. According to the US Department of Commerce, the privately-owned housing units authorized by building permits in March 2022 were around 1,873,000 which is 0.4% above February 2022 of 1,865,000 units and 6.7% above March 2021 of around 1,755,000 units. Moreover, according to Statistics of Japan, the number of construction contract orders went from 60,046,960 units in 2020 to 63,610,223 in 2021 and witnessed a growth in 2021 (Jan-July) compared to 2020(Jan-July). Thus, the growing building & construction industry would require more special steel due to their exhibit characteristics, which would drive the demand for the Special Steel market growth during the forecast period.
Special Steel Market Segment Analysis – by Geography
The Asia-pacific region held the largest Special Steel market share of up to 42% in 2021. It was due to the increasing requirement for special steel in developing countries such as China, Japan, India and South Korea. China is expected to continue its dominance in the special steel market during the forecast period. This is due to the growth of the building & construction industry in the country. According to International Trade Administration (ITA), China is the world’s largest construction market and is forecasted to grow at a CAGR of 8.6% between 2022 and 2030. Also, according to the Australian Government, the building and construction sector remains healthy in Singapore, with strong government spending on public infrastructure. About S$2 billion (US$1.43 billion) in contracts is awarded each month. Moreover, according to Invest India, by 2025, the building and construction industry is estimated to reach US$1.4 Trillion. Such increasing building & construction activities in the APAC countries are anticipated to increase the demand for special steel structures in the forecasted period. These factors are proving to be a market booster for the Special Steel market size in this region.
Special Steel Market Drivers
Increasing Aerospace & Defence Sector:
In the aerospace & defence industry, Special Steel provides good corrosion resistance, super toughness and high strength. It is utilized in manufacturing aerospace and defence components or parts that require high strength, temperature resistance and toughness. It is used in the manufacturing of different aircraft parts such as fuel tanks, high-temperature engine parts, exhaust components, structural parts, cabin components, landing gears and others. In 2021, the Government of Quebec and the Government of Canada, funded US$2 billion in the aerospace industry to drive the recovery of the sector. Moreover, in 2021, according to the International Trade Administration (ITA), the Dutch Government increased its investments in the aerospace & defence industry, investing €1.5 billion (US$1.57 billion) over the next five years, with a one-time increase of €1.2 billion (US$1.26 billion) in 2019 and an annual increase of €162 million (US$170 million) in the following years. Thus, increasing investments in the aerospace & defence sector would require more special steel for manufacturing aircraft parts, which would drive the demand for the Special Steel market during the forecast period.
Growing Automotive Industry:
In the automotive industry, Special Steel such as carbon steel, carbon tool steel, ordinary low-alloy steel, alloy steel for engineering structure, stainless steel and others is needed for the manufacturing of various vehicle and engine components such as door panels, chassis and support beams. It is also used in mufflers and exhaust pipes in the automotive. Moreover, it is generally applied to the frame of the vehicle because of its high strength. According to the European Automobile Manufacturers' Association (ACEA), in 2021, 79.1 million motor vehicles were produced around the world, an increase of 1.3% compared to 2020. Also, according to the Organisation Internationale des Constructeurs d'Automobiles (OICA), in the USA, the production of motor vehicles increased from 6,239,401 units in 2020 to 6,857,182 units in the year 2021. Moreover, in Austria, motor vehicle production increased from 86,300 units in 2020 to 92,000 units in the year 2021. With the increasing production of automobiles, it is estimated that in the upcoming years the requirement for special steel in the automotive industry would rise. This would boost the growth of the Special Steel industry.
Special Steel Market Challenge
High Manufacturing Cost of Special Steel:
Special Steels are expensive in comparison to ordinary steel in the market. Special steel mills require adequate infrastructure and technological capability to manufacture higher-quality steel. The high cost of infrastructure eventually makes special steel processing and manufacturing significantly expensive. In regions such as Asia-pacific and the Middle East, there is a struggle in acceptance. Due to the high manufacturing cost, the use of special steel is slightly less even after their multiple advantages over materials such as aluminum and plastic. Thus, the high manufacturing cost of Special Steel would create hurdles to the growth of the Special Steel market.
Special Steel Market Industry Outlook
Technology launches, acquisitions and R&D activities are key strategies players adopt in the Special Steel market. The top 10 companies in the Special Steel market are:
- Dongbei Special Steel Group
- Daido Steel Co. Ltd.
- Hyundai Steel Co., Ltd.
- Nippon Steel Corporation
- Aichi Steel Corporation
- Cleveland Cliffs, Inc.
- JSW Steel
- Baosteel Group
- Jiangsu Shagang Group
- ArcelorMittal
Relevant Reports
Report Code: CMR 53097
Report Code: CMR 1389