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CRGO Steel Demand in India: A Multi-Billion-Dollar Opportunity Under the Atmanirbhar Bharat Initiative

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  • October 2020
  • Region: India
  • InfraInsights
  • ID: 5264463

Overview of Report:

The Indian government's target to provide reasonable electricity to all households, upgrading the existing power grid systems and increasing productivity have attained a greater significance in the CRGO market. India's per capita power consumption of around 1,200 kilowatt-hours (kWh) per annum is much lower than the global average of 2,700 kWh. Therefore, for implementation, the government plans of reaching out to the approximately 1.4-billion Indian populations with affordable electricity. A transformer is required to meet the increasing need for electricity and good grid infrastructure.

The domestic transformer industry manufactures the complete range of power and distribution transformers, including transformers used for HVDC transmission up to 500 kV. Copper, CRGO (Cold Rolled Grain Oriented) steel, transformation oil are the key raw materials to manufacture transformer. A key factor that has posed some serious problems for the transformer manufacturing sector is the non-availability of cold-rolled grain-oriented (CRGO) material which has to be entirely imported namely Nippon, JFE, and Posco, among others. The problems regarding CRGO acquisition include the import of defective CRGO by unscrupulous suppliers, as well as procurement of this material. As a result, there have been heavy losses in distribution. Industry insiders say that there is a huge amount of second-grade material available in the market which is used by local manufacturers to be more competitive.

The CRGO steel grains are quite larger than the size of regular steel, around 2mm to 5mm, whereas the regular steel is about 0.5mm. This remarkable size difference enables low Hysteresis losses (the power expended in a magnetic material due to the lack of correspondence between the changes in induction resulting from the increase or decrease of magnetizing force).

CRGO steel usage by transformer manufacturers faces two major issues, such as there are some marginal distribution transformer manufacturers who deliberately use cheap and sub-standard CRGO. It helps them estimate lower during the procurement process of power utilities and there are some manufacturers who end up using substandard CRGO out of ignorance due to the fact that there is absolutely no way of knowing the quality of imported CRGO steel.

India has issues of having the highest transformer failure rate, which is significantly higher than even some of the less developed countries. Studies reveal that while the global level for transformer failure is around 5 percent, India's transformer failure rate is around 20-25 percent. This is an indication that the country is using sub-standard transformers.

CRGO steel continues to be a critical factor for modern transformer manufacturing in India. Thyssenkrupp with a joint venture with Tata Steel is the only manufacturers of CRGO steel in India with a current capacity of 35,000 tonnes per annum of CRGO electrical steel used in transformers for the power sector from the Nashik factory in Maharashtra and plans to expand to 50,000 tonnes. The import volume of 400,000 tonnes is expected to decline in the future.

The publisher sees the transformer sector creates promising opportunities for the CRGO steel manufacturers and hence this report aims to quantify the opportunity through extensive primary research. The report will be an indispensable source of information & insights for companies operating in the CRGO steel space as well as companies that want to enter this very promising sector.

Key Questions Answered

  • What is the current demand for CRGO steel in India?
  • What is the production capacity of CRGO steel in India?
  • What volume of CRGO steel requirement is met through imports?
  • What is the pricing trend in CRGO steel?
  • Which steel manufacturers are the leading CRGO steel producer in India and globally?
  • Is it possible to displace imports of CRGO steel from China?
  • What is the projected demand for CRGO steel in India?
  • How is the CRGO steel scrap recycled?
  • What are the key growth drivers for CRGO steel demand in India?
  • What is the sourcing strategy of CRGO steel of large to a small-sized transformer, generator manufacturers in India?

Table of Contents

1. Executive Summary2. Approach & Methodology
3. CRGO Steel & its Application
  • Transformers
  • Motors
  • Inductors
  • Others
4. CRGO Steel Global Production Overview
  • Production Capacity
  • Key players
5. CRGO Steel India Market Landscape
  • Industry Value Chain
  • Manufacturing Process
  • Manufacturing Capacity in India
  • Trade
6. CRGO Steel scrap market in India
7. Significance of CRGO Steel in the Electrical Equipment Industry
  • CRGO steel quality & Transformer failures in India
8. CRGO Steel Regulation & Policies in India
  • Standards governing CRGO Steel use
  • Import duty structure
9. CRGO Steel Manufacturers in India
10. CRGO Steel Imports from China
  • Evaluating CRGO sourcing of major electrical equipment OEMs in India
11. CRGO Steel Trends
  • Trend in CRGO Steel Demand
  • Trend in Supply in India
  • Import vs Indigenous Manufacturing
  • Trend in CRGO Steel Pricing
12. CRGO Steel Market Size Estimate 2019-2020
  • Market by Region
  • West
  • East
  • North
  • South
  • Market by end-user industry
  • Market by Grades
  • Market by Lamination & Cores
  • Market by imports vs indigenous manufacturing
13. CRGO Steel Competitive Landscape
  • Manufacturers of CRGO Steel Local & Overseas
  • Product Portfolio
  • Market Share Analysis
14. CRGO Steel growth drivers
15. Demand Assessment of CRGO Steel by 2025
  • Market by Region
  • Market by Segment
  • Market by Grades
16. Evaluating 100% indigenization of CRGO Steel demand in India
  • Raw material availability vs required
  • Capacities planned
  • Restraints for setting up CRGO steel plant in India
17. Go to Market Strategy & recommended location



Companies Mentioned

A selection of companies mentioned in this report includes:

  • AK Steel
  • JFE
  • Nippon
  • Novolipetsk Steel
  • Posco
  • ThyssenKrupp