Market Trends of Soft Magnetic Material Industry
Electronics and Energy Segment to Dominate the Market
- The usage of soft magnetic materials has been increasing in the electronics and energy generation industries. Soft magnetic materials find their application in AC and DC converter devices, electric motors, transformers, alternators, power inductors, and computers, amongst others.
- The power transformer market in the United States as of the end of 2022 was approximately 2,500 units, as per Power Technology Research (PTR). Further, in 2023, over 68 million desktops were shipped worldwide. In 2027, desktop shipments are expected to rise slightly to around 69 million units. By contrast, notebook shipments are expected to reach more than 214 million units in 2027, up from 207 million units in 2022.
- Soft magnetic materials find application in various electronic devices such as wireless charging, sensors, high-frequency products, data storage devices, etc. According to the Japan Electronics and Information Technology Industries Association (JEITA), the production by the global electronics and IT industry was expected to reach USD 3,436.8 billion, with a growth rate of 3 percent year on year, by 2023.
- The demand for electric motors, transformers, and actuators has seen decent growth in recent years as power plants in Asia-Pacific region are increasing. Additionally, According to the India Brand Equity Foundation (IBEF), the market size of transformers across the country was around USD 11 billion in fiscal year 2022.
- Further, according to the Department for Promotion of Industry and Internal Trade (India), the annual growth rate of electricity production in India was 8 percent in 2022. It was expected to reach 9.8 percent in 2023.
- In addition, according to Ember, China's renewable energy production in 2022 reached approximately 2,670 terawatt hours. This is the highest figure recorded and is a result of increased capacity for power generation, particularly for solar and wind farms.
- Additionally, solar energy generation in China reached approximately 418 terawatt hours in the same period.
- Therefore, all these factors are expected to lead to an increase in demand for soft magnetic materials in the forecast period.
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Asia-Pacific Region to Dominate the Market
- Asia-Pacific is expected to dominate the global market owing to the vast power generation sector in China, in addition to the continuous investments done in the region to advance the electronics and automotive sectors through the years.
- According to the China Electricity Council (CEC), China has a total installed electricity generation capacity of 2,559.47 gigawatts. Thermal power plants, mostly coal-fired, account for more than half of this capacity, with a combined capacity of 1,332.39 gigawatts as of 2022. Hydropower facilities have the largest renewable energy capacity.
- India aims to achieve electronics manufacturing worth USD 300 billion by 2026, as it aspires to become a USD 1 trillion economy by 2025, according to the Economic Times.
- The adoption of electric vehicles in the Asia-Pacific region, due to increasing government regulations on automobiles, has fueled the usage of soft magnetic materials in electric motors.
- China's sales of new electric vehicles (EVs) increased by 82 percent in 2022 compared to the previous year. The country accounted for 59 percent of global EV sales in 2023, making it the world's largest electric vehicle market and producer, with 64% of global volume.
- Japan has pledged to become carbon neutral by 2050, making EVs a necessity to meet these targets, and increasing the demand for soft magnetic materials in the forecast period.
- The International Energy Agency (IEA) reported that electric vehicles made up approximately three percent of passenger cars sold in Japan in 2022.
- Thus, all the factors above are likely to increase the demand for soft magnetic materials in the forecast period.
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