Soft Magnetic Materials Market

Soft Magnetic Materials Market Size and Share:

The global soft magnetic materials market size was valued at USD 34.1 Billion in 2024. Looking forward, IMARC Group estimates the market to reach USD 62.6 Billion by 2033, exhibiting a CAGR of 7% during 2025-2033.  Asia Pacific currently dominates the market, holding a significant market share of over 52% in 2024. The market is being pushed by increased demand for electric and hybrid vehicles, developing renewable energy infrastructure, and recent technological developments, with considerable expansion in Asia-Pacific, bringing both challenges and possibilities for innovation and sustainability.

The growing adoption of electric vehicles and the consequent need for electric motors is one of the key factors boosting the growth of the market. Soft magnetic materials like silicon iron, sintered iron, and phosphorus iron are widely used in electric motors to minimize energy loss and increase efficiency. As per estimates by IMARC Group, the global electric motor market is projected to witness a 3.4% CAGR from 2025-2033. Besides this, advancements in the development of high-performance materials are also driving the growth of the market. The increasing number of renewable energy sources including wind and solar is escalating the demand for magnetic materials in generators and transformers. Integration of new technologies in consumer electronics and a shift toward more sustainable manufacturing processes are also contributing to the market growth.

The United States is emerging as a key regional market for soft magnetic materials. The market in the country is driven by increasing demand for renewable energy systems, EVs, and advanced electronics. Furthermore, research and development in the field of material technology and investments in magnet manufacturing are accelerating growth. For instance, in September 2024, Ara Partners, a private equity firm, received USD 335 million in non-recourse financing for a permanent magnet manufacturing plant aimed at enhancing the supply chain for EVs, aerospace and defense, and renewable energy in the country. The facility is owned by e-VAC Magnetics LLC, a recently formed U.S. entity wholly owned by Ara Partners.

Soft Magnetic Materials Market Trends:

Increasing Demand in Automotive Industry

According to the International Energy Agency, the automotive industry is undergoing a transformative shift with the increasing adoption of electric and hybrid vehicles. 2023 saw the registration of about 14 million new electric cars worldwide, increasing the total number of automobiles on the road to 40 million. Soft magnetic materials are essential in the efficient functioning of electric motors, transformers, and other such components used in electric and hybrid cars. In addition, stringent emission regulations and consumer demand for more environmentally friendly options have forced automobile manufacturers to incline toward increased use of soft magnetic materials in the enhancement of electric drivetrain performance and efficiency. Besides, advancements in magnetic materials are also contributing to the development of more compact and powerful motors, which are crucial for the next generation of electric vehicles (EVs).

Expansion of Renewable Energy

The renewable energy sector is expanding rapidly, propelled by a global demand for sustainable and ecological energy sources. According to Eurostat, the share of renewables in the European Union's (EU) final energy consumption climbed by more than one percentage point from 2021 to 23% in 2022. The bloc's 2030 renewable energy objective is 42.5%. Soft magnetic materials are crucial for many renewable energy systems, including solar inverters and wind turbine generators. These materials are essential to the development of renewable energy infrastructure because they are necessary for effective energy conversion and storage. The market share of soft magnetic materials is also growing as a result of continuous technological developments in renewable energy technologies, which keep improving the effectiveness and affordability of these systems.

Advancements in Electronics and Telecommunication

Consumer electronics, such as smartphones, tablets, laptops, and wearable devices, require highly efficient magnetic components for their compact and power-efficient designs. According to market reports, by the end of 2021, 5.3 billion people subscribed to mobile services, representing 67% of the global population. The current soft magnetic materials market outlook highlights the use of these materials in inductors, transformers, and other components essential for power management and signal processing. The market size for soft magnetic materials is also being influenced by the growth of telecommunications infrastructure, such as the introduction of fifth-generation (5G) networks, which demand the use of sophisticated magnetic materials in base stations, antennas, and other communication equipment to guarantee high performance and dependability. Furthermore, the demand for greater energy economy and the trend toward smaller electronic components are spurring research in soft magnetic materials, which will allow for the creation of devices that are lighter, more compact, and more effective.

Soft Magnetic Materials Industry Segmentation:

IMARC Group provides an analysis of the key trends in each segment of the global soft magnetic materials market, along with forecasts at the global, regional, and country levels from 2025-2033. The market has been categorized based on material, application, end-use, and region.

Analysis by Material:

• Cobalt
• Iron
• Nickel
• Electrical Steel
• Others
   

Electric steel material stands as the largest material in 2024, holding around 61.7% of the market. Electric steel, also known as silicon steel or transformer steel, holds the majority of the soft magnetic materials market share due to its superior magnetic properties and widespread application in electrical devices. This type of steel is specially engineered to have high permeability and low coercivity, making it ideal for use in transformers, inductors, and motors, which are essential components in various electrical and electronic devices. Furthermore, the ability of electric steel to efficiently conduct magnetic fields and reduce energy losses makes it a preferred choice for manufacturers aiming to enhance the performance and efficiency of their products.

 Analysis by Application:

• Motors
• Transformers
• Alternators
• Others
   

Motors leads the market with around 51% of market share in 2024. Motors are dominating this segment, as highlighted in the latest soft magnetic materials market report, because of their extensive use across various industries, including automotive, industrial machinery, and consumer electronics. Soft magnetic materials are critical in motor applications due to their ability to enhance magnetic flux, minimize energy losses, and improve overall efficiency. Additionally, the transition toward electric and hybrid vehicles has significantly increased the demand for electric motors, which rely heavily on soft magnetic materials for optimal performance. Furthermore, industrial applications such as robotics, automation, and heating, ventilation, and air conditioning (HVAC) systems require efficient and reliable motors to ensure operational excellence.

Analysis by End Use:

• Automotive
• Electrical and Electronics
• Telecommunication
• Energy and Power
• Others
   

Electrical and electronics leads the market with around 39.5% of market share in 2024. The electrical and electronics sector represents the largest market share, reflecting the widespread adoption of soft magnetic materials in a wide array of electronic devices and electrical systems. Moreover, soft magnetic materials are integral to the functionality of transformers, inductors, sensors, and various other components that form the backbone of modern electronics. These materials enable the miniaturization and enhancement of devices such as smartphones, tablets, laptops, and wearable technology. Furthermore, the efficiency of power generation, transmission, and distribution systems is heavily reliant on the quality of soft magnetic materials used. Additionally, the growing demand for smart home devices, renewable energy solutions, and advanced telecommunication infrastructure further underscores the importance of these materials.

 Regional Analysis:

• North America
  • United States
  • Canada
• Asia Pacific
  • China
  • Japan
  • India
  • South Korea
  • Australia
  • Indonesia
  • Others
• Europe
  • Germany
  • France
  • United Kingdom
  • Italy
  • Spain
  • Russia
  • Others
• Latin America
  • Brazil
  • Mexico
  • Others
• Middle East and Africa
   

In 2024, Asia-Pacific accounted for the largest market share of over 52%. Based on the recent soft magnetic materials market forecast, Asia-Pacific is the dominant region due to its robust industrial base, rapid economic growth, and substantial investments in infrastructure development. Additionally, countries like China, Japan, South Korea, and India are at the forefront of technological advancements and industrial production, making them significant consumers of soft magnetic materials. Besides this, the burgeoning automotive industry in Asia-Pacific, particularly the surge in electric vehicle (EV) manufacturing, has increased the demand for these materials. Additionally, the region's strong presence in the electronics manufacturing sector, producing a vast array of consumer electronics, industrial machinery, and telecommunication equipment, is further driving the market growth.

Key Regional Takeaways:

United States Soft Magnet Materials Market Analysis

In 2024, the United States accounts for over 91.3% of the soft magnetic materials in North America. In North America, the increasing demand for energy efficient power generation and transmission systems is propelling the adoption of soft magnetic materials in electrical equipment, such as transformers and inductors. The United States soft magnetic material market faces distinct dynamics. Moreover, with limited rare earth resources, higher labor costs, and stringent environmental policies, the United States has seen a comparatively slower industry growth rate. The reliance on imports for rare earth ores and competitive pressures has shaped the trajectory of the soft magnetic material sector. The expansion of the renewable energy sector, including wind and solar power, is driving the need for soft magnetic materials in generators and converters.

Apart from this, the rise in consumer electronics and telecommunications applications is escalating the demand for soft magnetic materials in devices like smartphones and high-frequency transformers, which is augmenting the market growth. Moreover, the expanding EV sector, with over 7% of new cars sold in the US becoming electric in 2023 is escalating the demand for soft magnetic materials. Electric motors and charging infrastructure require soft magnetic materials to ensure performance and energy efficiency. Moreover, the rising demand is further increased by the telecommunications sector's need for sophisticated materials for better signal processing, which is fueled by the growth of 5G networks. In order to create cutting-edge alloys and secure market expansion, major American corporations such as Carpenter Technology and Arnold Magnetic Technologies are making significant investments in research and development (R&D).

Europe Soft Magnet Materials Market Analysis

The market for soft magnetic materials in Europe is supported by the region's focus on industrial automation, electric car adoption, and renewable energy. Moreover, soft magnetic materials are essential for energy conversion and storage in wind and solar power, which has seen large expenditures as a result of the European Union (EU)’s strict carbon neutrality requirements. For example, these materials are essential to the wind power industry in Europe, which installed 17 GW of new capacity in 2023.

Furthermore, the market is expanding as a result of continuous research and development initiatives meant to improve the qualities and performance of these materials. A European soft magnetics collaborative project was launched in 2019 with the goal of creating and refining soft magnetic materials for a variety of industrial uses, including sensors, electric motors, and transformers.

Asia Pacific Soft Magnet Materials Market Analysis

The Asia Pacific soft magnetic material market is widely influenced by China's rare earth resources, low labor costs, and rapid industry growth. Additionally, with over 55% of global rare earth mining, China's magnet sector sets a competitive pace. The expanding automotive sector, characterized by the electrification trend and the development of electric vehicles, is another significant factor propelling the market growth.  Furthermore, the robust presence of electronics manufacturing in countries like China, Japan, and South Korea has amplified the consumption of soft magnetic materials in consumer electronics and telecommunications industries.

Besides, companies, such as Toshiba Materials, are focusing on the development of advanced soft magnetic alloys, tailored for high-performance applications in motors and transformers. For instance, in 2023, Toshiba Materials Co., Ltd. announced a major investment in a new production facility that will significantly boost its production capacity. On account of this, the demand for soft magnetic materials is escalating across the region.

Latin America Soft Magnet Materials Market Analysis

Power grid upgrading and rising investments in renewable energy are driving the soft magnetic materials market in Latin America. The focus on wind and solar energy projects in nations like Brazil and Mexico is escalating the demand for effective energy conversion and storage systems that use soft magnetic materials. Besides, the region's expanding automotive industry, especially in the areas of electric and hybrid vehicles, is also helping the market flourish. Furthermore, government programs to improve energy efficiency and partnerships with multinational manufacturers also contribute to market expansion.

Middle East and Africa Soft Magnet Materials Market Analysis

The rapid growth of the energy and power sectors in the Middle East and Africa region is primarily due to urbanization and infrastructural development, which is escalating the demand for soft magnetic materials in transformers, generators, and energy-efficient devices. Moreover, the expansion of the automotive industry, particularly in the Middle East, underscores the need for these materials in electric vehicle components and powertrain systems. In 2022, the United Arab Emirates (UAE) announced plans to develop an automotive manufacturing hub in Dubai to attract international automakers and suppliers to set up operations in the region.

Competitive Landscape:

At present, key players in the soft magnetic materials market are intensifying their efforts in research and development to enhance the efficiency and performance of their products. These firms are focusing on creating materials with higher saturation magnetization and lower core losses to meet the escalating demands of advanced electronics and electric vehicle markets. Additionally, they are expanding their manufacturing capabilities and forming strategic alliances to bolster their global supply chains and market reach. Moreover, environmental sustainability is also a priority, with investments aimed at reducing the carbon footprint of production processes. This proactive approach is helping them stay competitive in a rapidly evolving industry landscape. For instance, in October 2024, US technology startup Niron Magnetics initiated commercial-scale production of its rare earth-free permanent magnets, aiming to reduce reliance on Chinese raw materials for wind turbines and boost the growth of the American renewable energy manufacturing sector.

The market research report has also provided a comprehensive analysis of the competitive landscape in the market. Detailed profiles of all major companies have also been provided. Some of the major market players in the soft magnetic materials industry include:

• Arnold Magnetic Technologies
• Daido Steel Co. Ltd
• GKN Sinter Metals Engineering GmbH
• Hitachi Ltd
• Mate Co. ltd
• Meyer Sintermetall AG
• SG Technologies
• Steward Advanced Materials
• Sumitomo Metal Mining Co. Ltd
• Toshiba Materials Co Ltd (Toshiba Corporation)
• Vacuumschmelze GmbH & Co KG
   

Latest News and Developments:

• In 2023: Daido Steel, a Japan-based steel producer, has announced that it will invest JPY 5.2 billion ($ 39.58 million) to construct two new special melting facilities at its Chita No.2 plant. This will increase the company’s production capacity for high-grade steel to meet the increasing demand for these steel in semiconductor manufacturing equipment.
• In 2023: GKN Powder Metallurgy and Schaeffler AG announced a joint commitment to further the development of permanent magnet industry in Europe and North America.
• In 2023: Toshiba Materials Co., Ltd. announced a major investment in a new production facility that will significantly boost its production capacity.
• In 2022: The United Arab Emirates (UAE) announced plans to develop an automotive manufacturing hub in Dubai to attract international automakers and suppliers to set up operations in the region.
• In 2019: A European SoftMagnetics collaborative project was introduced that aimed to develop and optimize soft magnetic materials for numerous industrial applications, such as electric motors, transformers, and sensors.
   

Soft Magnetic Materials Market Report Scope:

Key Benefits for Stakeholders:

• IMARC’s report offers a comprehensive quantitative analysis of various market segments, historical and current market trends, market forecasts, and dynamics of the soft magnetic materials market from 2019-2033.
• The soft magnetic materials market research report provides the latest information on the market drivers, challenges, and opportunities in the global market.
• The study maps the leading, as well as the fastest-growing, regional markets. It further enables stakeholders to identify the key country-level markets within each region.
• Porter's five forces analysis assist stakeholders in assessing the impact of new entrants, competitive rivalry, supplier power, buyer power, and the threat of substitution. It helps stakeholders to analyze the level of competition within the soft magnetic materials industry and its attractiveness.
• Competitive landscape allows stakeholders to understand their competitive environment and provides an insight into the current positions of key players in the market.