Electrical steel, also known as silicon steel or silicon electrical steel, is a special steel used primarily for laminations in transformers, generators, electric motors etc. It has excellent magnetic properties and characteristics like low core loss and high permeability that are essential in electric machines and transformers. The Philippines has seen a steady rise in the domestic production of electrical steel over the past decade with more companies investing in setting up manufacturing facilities in the country. This article discusses the key developments and growth of the electrical steel in the Philippines.
Growing Philippines Electrical Steel
With economic growth and industrialization, demand for electrical steel has increased significantly in the Philippines over the years to meet the needs of expanding power infrastructure and manufacturing industries. Local steel mills were unable to fully meet this growing demand, forcing import reliance. However, electricity usage per capita in the Philippines is still relatively low compared to other ASEAN countries providing immense potential for future growth. Recognizing this opportunity, several companies stepped up investments to ramp up domestic electrical steel production capacity.
New Manufacturing Plants
In 2015, one of the largest steel producers in Asia, China Baowu Steel Group, announced plans to build a new electrical steel plant in Batangas, Philippines. The $380 million plant has an annual capacity of 500,000 tons. It was the first integrated electrical steel mill to be set up in the country. In 2017, another Chinese steel major – Shanghai Electric Group constructed a new electrical steel facility in Batangas with an annual capacity of 300,000 tons. Japanese steelmaker JFE also set up an electrical steel mill in Panay Island in 2018 with a 100,000 tons/year capacity.
Surge In Local Production
With these new state-of-the-art plants commencing commercial operations, Philippines’ domestic electrical steel production witnessed a strong growth over the last 5 years. According to the Department of Trade and , local production of electrical steel increased from around 300,000 tons in 2015 to over 1 million tons in 2020. This has substantially reduced import dependence as the country’s requirement was being largely met through domestic supplies. The government has also taken policy initiatives like tax breaks to encourage further investments in electrical steel to ensure energy security for its fast growing economy.
Quality Standards And Certifications
Maintaining consistent quality standards is crucial for electrical steel as even minor defects can affect performance of electric equipment. The mills in Philippines have acquired certifications from international bodies like JIS, IEC, ANSI etc. to demonstrate adherence to global quality benchmarks. Strict quality control protocols along with advanced continuous annealing and processing lines help produce electrical steel strips, plates, and laminations as per customers’ exacting specifications across industries. Local manufacturers are also investing in R&D to develop new electrical steel grades with lower core losses and higher permeabilities suitable for high-efficiency transformers and motors.
Exports s Expansion
With Philippines establishing itself as a reliable domestic supplier of quality electrical steel, manufacturers have started exploring export s as well. Major export destinations currently include other ASEAN countries, Australia, China, India and the Middle East. To boost overseas shipments, the government is providing subsidies and incentives through its export promotion board. The US$ Free Trade Agreement has opened up opportunities in the huge USA while further FTAs will aid access to more global s going ahead. Exports of electrical steel from Philippines grew over 30% year-on-year between 2018-2020 and are projected to maintain strong momentum.
Employment Opportunities
The burgeoning domestic electrical steel has generated significant job opportunities in the Philippines. The new greenfield plants employ thousands of workers directly and support numerous related small and large businesses. Besides production jobs, employment exists across functions like engineering, maintenance, quality control, supply chain and logistics. Skilled workforce is being developed through technical training programs in collaboration with educational institutes. This has substantially boosted industrial employment and economic growth especially in regions hosting these steel mills. Further capacity additions are likely to augur well for employment generation in the country’s electrical steel sector.
This marks the wrap up of on the rise of electrical steel production in the Philippines highlighting key topics like growing local demand and investments, expansion in manufacturing capacities, focus on quality, export push and employment creation. The article presented an overview of the status and developments in clear headed and easy to understand manner for the target news blog audience.
*Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it
About Author - Vaagisha Singh
Vaagisha brings over three years of expertise as a content editor in the market research domain. Originally a creative writer, she discovered her passion for editing, combining her flair for writing with a meticulous eye for detail. Her ability to craft and refine compelling content makes her an invaluable asset in delivering polished and engaging write-ups. LinkedIn