iCrowd Newswire – Oct 19, 2020
Ultra-high strength steel market size is forecast to reach $8.09 billion by 2025, after growing at a CAGR of 7.18% during 2020-2025, owing to the rising usage of ultra-high-strength steel in various end-use industries such as automotive & transportation, aerospace & defense, and more due to its extensive set of characteristics such as weldability, corrosion resistance, outstanding hole expansion coefficient, excellent fatigue resistance, flexible design, cost-efficient, high tensile strength, stiffness, abrasion resistance, high ductility, durable, good flatness, and surface quality. Furthermore, there is an increasing demand for lightweight vehicles as they make the vehicle fuel-efficient, which reduces the running costs and fuel consumption of the vehicle. And since ultra-high-strength steel is lightweight and they improve the performance of the vehicle, its demand is increasing, which is anticipated to drive the ultra-high-strength steel industry market substantially during the forecast period.
By Product Type – Segment Analysis
The martensitic material segment held the largest share in the Ultra-high strength steel market in 2019, owing to the unique properties of martensitic steels such as higher strength-to-weight ratio as compared to other conventional cold-rolled steels. Martensitic materials are primarily utilized in the development of safety and structural components of automobiles. Martensitic steel has a high tensile strength which makes them ideal for cold forming of structural components. In addition, Ultra-high strength steel possesses high energy absorption characteristics and large elongation. Also, it has better formability and component strength, which is anticipated to boost the demand for martensitic material from the Ultra-high strength steels market during the forecast period.
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By End-Use Industry – Segment Analysis
The aerospace and defense application held the largest share in the Ultra-high strength steel market in 2019 and is growing at a CAGR of 5.69%, owing to the increasing demand for Ultra-high strength steel such as residual austenitic (RA) steels and transformation induced plasticity from the aerospace sector to meet the higher performance expectations, reduced weight, and stringent regulatory requirements at lowest life cycle cost. The automotive and transportation segment held the second-largest share in the ultra-high strength steel market. Ultra-high strength steel is widely used in vehicle body structures to make the vehicle lighter, to optimize vehicle designs that enhance the safety of the passengers in the automobile and enhance fuel economy by reducing automobile bodyweight to reduce CO2 emissions. Also, the Ultra-high strength steel is being extensively used in the automotive industries for manufacturing car components such as bodies, door impact beams, reinforcement parts, bumpers, seat frame parts and more as their strength allows automakers to manufacture very thin gauges, thus reducing the weight of the vehicles, which is expected to increase the demand of Ultra-high strength steel from the automotive and transportation sectors during the forecast period.
By Geography – Segment Analysis
Asia Pacific region held the largest share in the ultra-high strength steel market in 2019 up to 41%, owing to the rise in demand and production of automobiles in the region, due to the increasing population. In 2018, according to OICA, the automotive production in India, Thailand, Indonesia, and Malaysia has increased up to 5174645, 2167694, 1343714 and 564800, i.e., 8.0%, 9.0%, 10.3%, and 12.2% higher than the previous year due to rising per capita income of the individuals which further led to the massive demand for advanced automotive machines manufacturing in the APAC region. According to the International Trade Administration (ITA), China is the world’s largest vehicle market and the Chinese government is expecting that automobile production will reach 30 million units by 2020 and 35 million by 2025. In 2018, according to the China Association of Automobile Manufacturers, over 27 million vehicles were sold in the country. Thus, the increasing automation production will require more Ultra-high strength steel such as residual austenitic (RA) steels and transformation induced plasticity for manufacturing various automotive parts, which is anticipated to propel the Ultra-high strength steel market in the APAC region during the forecast period.
Drivers – Ultra-high Strength Steel Market
Increasing Aerospace Industry
There is an increasing demand for ultra-high strength steel from the aerospace sector due to its extensive properties such as low cost, corrosion resistance, high impact strength, durable, and more. According to the International Trade Administration (ITA), in 2019 China was the world’s second-largest civil aerospace and aviation services markets and one of the fastest-growing markets. In 2016, according to Boeing, China is estimated to require around 6,810 new commercial aircraft, valued at USD 1 trillion, over the next two decades. By the end of 2018, China had more than 59 airlines and 3,615 civil aircraft (an increase of 10% over 2017). According to China’s 13th Five Year Plan (2016-2020), by 2020, China will have more than 4,500 civil aircraft, and by 2018, the number of Chinese civil airports had grown to 235. According to the International Trade Administration (ITA), in 2018 the Indian government spent a total of $645 in the civil aviation sector. Also, according to Boeing India is expected to drive the demand for 2,300 aircrafts worth US$320 billion over the next 20 years. The increasing aviation industry acts as a driver for the Ultra-high strength steel market.
Increasing Building and Construction Activities
There is an increasing demand for ultra-high-strength steel form the building and construction activities to apply damage control design is the building, which controls the damage to columns and beams by employing a seismic energy absorption mechanism termed as a damper to enable the reuse of the building even after an earthquake. Also, the Ultra-high strength steel structure offer advantages in structural, architectural, economical, environment protection, and energy-saving aspects due to which it is being widely used in the building and construction activities. According to the US Census Bureau, in February 2020 total construction was at a seasonally adjusted annual rate of 1,366,697 which is 6.0 percent above the February 2019 rate of 1,288,951. According to the European Commission, the total construction investment in Germany increased by 9.5% over 2008-2015. Also, the European Construction 2020 Action Plan aimed at stimulating favorable investment conditions. The building and construction activities are also increasing owing to the various government initiatives such as Foreign Direct Investments (FDI), which acts as a driver for the Ultra-high strength steel market during the forecast period.
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Challenges – Ultra-high Strength Steel Market
Volatility in Raw Material Prices
Raw materials of Ultra-high strength steel have always shown significant volatility in their prices that reflect temporary shortage or surplus conditions in the markets. For example, in 2017, coking coal prices increased in April when the tropical cyclone Debbie hit Queensland in Australia, damaging the major railway carrying coal to ports; and then it increased again in December when prices went over USD 240 per tonne due to delays in shipments from Dalrymple Bay, a coal terminal in Australia. These increases were also triggered by the limitations of coking coal production in China. As of 31 December 2018, iron ore prices stabilized at around USD 72 per tonne, up from USD 64 in June 2018. On 31 December 2018, coking coal prices stabilized at USD 196 per tonne, after a volatile period of 2016-2017. Scrap prices decreased steadily during 2018, reversing most of their 2017 gains, falling to USD 264 per tonne as of 31 December 2018. Thus the volatility in the raw materials of Ultra-high strength steel due to various factors may hinder the Ultra-high strength steel market growth during the forecast period.
Covid-19 Impact on The Ultra-high Strength Steel Market
The COVID-19 pandemic outbreak has impacted the imports and exports of Ultra-high strength steel raw materials such as iron ore, coking coal, ferrous scrap, nickel, and others as Governments of the leading producing countries have imposed export restrictions which are significantly disrupting with the supplies. Also, since the industries which require Ultra-high strength steel for manufacturing products such as automotive and aviation are shut down, the demand for Ultra-high strength steel have disruptively fallen, which is affecting the Ultra-high strength steel market negatively.
Technology launches, acquisitions, and R&D activities are key strategies adopted by players in the Ultra-high strength steel market.Major players in the Ultra-high strength steel market are Anshan Iron and Steel Group Corporation, ArcelorMittal S.A, China Baowu Steel Group Corp. Ltd., JFE Steel Corporation, Kobe Steel Ltd., Nippon Steel & Sumitomo Metal Corporation, Shougang Group, Tata Steel Limited, ThyssenKrupp AG and Voestalpine Stahl GmbH.
In November 2016, ArcelorMittal S.A. launched two new martensitic sheets of steel MartINsite® M2000 & M1700 and press hardenable steels Ductibor® 1000 & Usibor® 2000. The steels were launched to help automotive manufacturers in reducing their vehicle weight without compromising on performance or safety.
Asia Pacific dominates the ultra-high strength steel market, owing to the increasing demand for Ultra-high strength steel from the automotive industries to manufacture interior parts and bumpers of the automobiles. According to OICA, the production of light commercial vehicles has augmented by 10.2 % in 2018 in the APAC region.
Dual-phase ultra-high strength steel material prevents fatigue cracks and has high cyclic resistance. Ultra-high-strength steel is also used for making the fittings and body of missiles on account of its lightweight and ability to withstand the pressure which is expected to propel the Ultra-high strength steel market during the forecast period.
The raw materials of ultra-high strength steel such as Iron ore and metallurgical coal quality have shown a significant deterioration in recent times. This has put huge pressure on the efficiency and the environmental performance of the global steel industry’s raw materials processing operations, which may restrain the Ultra-high strength steel market growth during the forecast period.
Due to the COVID-19 pandemic, most of the countries have gone under lockdown, due to which operations of various industries such as automotive and aerospace have been negatively affected, which is hampering the ultra-high strength steel market growth.
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B. High Performance Alloys Market
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