Electric Arc Furnaces Market Size, Share, Growth, and Industry Analysis, By Type (AC-EAF, and DC-EAF), By Application (Metal smelting, Ore smelting, and Others), Regional Insights and Forecast From 2025 To 2033

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ELECTRIC ARC FURNACES MARKET OVERVIEW

The global Electric Arc Furnaces Market was valued at USD 1.48 billion in 2024 and is expected to grow to USD 1.6 billion in 2025, reaching USD 3.02 billion by 2033, with a projected CAGR of 8.23% from 2025 to 2033.

The electric arc furnaces are vital industrial tools employed within the steel production process, serving the purpose of melting and purifying scrap steel along with other raw materials, resulting in the creation of fresh steel goods. The electric arc furnaces hold a pivotal role within the contemporary steel manufacturing sector, specifically in the crafting of specialty steels, stainless steel, and a variety of alloyed steel products.

ELECTRIC ARC FURNACES MARKET KEY FINDING

• Market Size and Growth: The global Electric Arc Furnaces Market was valued at USD 1.48 billion in 2024 and is expected to grow to USD 1.6 billion in 2025, reaching USD 3.02 billion by 2033, with a projected CAGR of 8.23% from 2025 to 2033.

• Key Market Driver: The Bureau of International Recycling (BIR) reports that 90% of raw materials in EAFs are derived from recycled scrap, significantly reducing environmental impact and operational costs.

• Major Market Restraint: As per the U.S. Department of Energy (DOE), EAFs consume 400–500 kWh of electricity per ton of steel, making energy cost a major limiting factor in regions with expensive or unstable power supplies.

• Emerging Trends: According to the International Energy Agency (IEA), the adoption of low-emission EAF technologies has led to a 40% decline in energy intensity in steel production over the last decade.

• Regional Leadership: Data from the European Steel Association (EUROFER) indicates that over 60% of new steel production in the EU now utilizes electric arc furnace technology due to stricter carbon emission standards.

• Competitive Landscape: According to Danieli, the company has installed 250+ EAF systems globally, while Primetals Technologies has delivered EAF projects capable of producing over 1 million tons of steel annually per unit.

• Market Segmentation: The World Steel Association classifies EAF applications across construction, automotive, and machinery sectors, with 35% of EAF-produced steel directed toward infrastructure development.

• Recent Development: According to the World Steel Association’s 2023 report, investments in EAF upgrades rose by 25% globally, with a focus on digital automation and energy efficiency enhancements.

COVID-19 IMPACT

Increased Demand for Scrap Steel among Population to Fuel Market Growth

The COVID-19 pandemic has been unprecedented and staggering, with experiencing lower-than-anticipated demand across all regions compared to pre-pandemic levels. The sudden decline in CAGR is attributable to the market’s growth and demand returning to pre-pandemic levels.

The COVID-19 pandemic triggered a surge in the demand for scrap steel, creating a dual effect on the electric arc furnaces market. The economic instability and pandemic-related disruptions prompted various industries to search for economical sources of raw materials. Compared to conventional raw materials like iron ore, scrap steel tends to be a more cost-effective option. The electric arc furnaces predominantly rely on scrap steel as their primary input material, positioning them favorably to capitalize on this emerging pattern.

Numerous steel mills and electric arc furnace facilities were compelled to implement temporary closures or scale back their production levels owing to lockdowns and a scarcity of available workforce, resulting in diminished steel production and financial setbacks.

LATEST TRENDS

Increased Focus on Sustainability, and Technological Advancements to Fuel Market Growth

The increased emphasis on sustainability within the market is a reflection of a growing recognition of the environmental and social impacts associated with steel production. Sustainability initiatives are closely linked to the goal of reducing carbon emissions across various industries, including steel manufacturing. The electric arc furnace inherently exhibits a higher level of environmental friendliness compared to traditional blast furnaces because they predominantly rely on scrap steel as their primary raw material. This recycling process leads to substantially reduced greenhouse gas emissions when compared to the production of steel from iron ore in blast furnaces. In a global climate where governments and organizations are intensifying their efforts to curtail carbon emissions, electric arc furnaces have gained favor due to their reduced carbon footprint. Another key advantage of electric arc furnaces is their superior energy efficiency in comparison to blast furnaces. By using electricity to melt scrap steel, EAFs are often regarded as a more energy-efficient alternative. Advancements in electric arc furnace technology were ongoing, with a continual focus on enhancing efficiency, reducing energy consumption, and optimizing overall performance. These innovations encompassed the development of more efficient electrodes, upgrades to process control systems, and the enhancement of refractory materials.

• According to the International Energy Agency (IEA), over 25% of global steel was produced via electric arc furnaces (EAFs) in 2022, largely due to their ability to use scrap steel, reducing carbon emissions by up to 75% compared to blast furnaces.

• As per the World Steel Association, more than 30% of EAFs globally are now being powered by electricity sourced from renewable energy, contributing to a 40% reduction in energy intensity for steelmaking processes over the past decade.

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ELECTRIC ARC FURNACES MARKET SEGMENTATION

By Type

Based on Type, the market is classified as AC-EAF, and DC-EAF.

By Application

Based on Application, the market is classified as Metal smelting, Ore smelting, and Others.

DRIVING FACTORS

Environmental Regulations to Fuel Market Growth 

The electric arc furnaces market growth has been significantly shaped by stringent environmental regulations and emissions standards. Steel manufacturers, in their pursuit of compliance with these regulations, are increasingly inclined toward electric arc furnaces due to their lower emissions compared to traditional blast furnaces, driving the expansion of the market.

Sustainability Initiatives to Stimulate Market Progress

The rising consciousness regarding sustainability and the aspiration to diminish the carbon impact of steel manufacturing have contributed to the growing demand for electric arc furnaces. Their utilization of scrap steel and lower energy consumption are in alignment with sustainability objectives, driving the increased interest in electric arc furnaces.

• According to the Bureau of International Recycling (BIR), the world generated 630 million metric tons of steel scrap in 2023, providing a significant raw material base for EAF operations, which rely on scrap for nearly 90% of their input.

• As per the European Environment Agency (EEA), regulations implemented under the EU Industrial Emissions Directive have pushed steel producers to reduce CO₂ emissions by 50% by 2030, favoring the adoption of EAFs over traditional methods.

RESTRAINING FACTOR

High Initial Capital Investment to Harm Market Growth

The substantial initial capital investment needed to establish or upgrade electric arc furnaces facilities might act as a deterrent for certain steel manufacturers, particularly smaller enterprises, considering the adoption of this technology.

• According to the U.S. Department of Energy (DOE), EAFs consume approximately 400–500 kWh of electricity per ton of steel produced. In regions with high electricity prices, this results in up to 20% higher operating costs than blast furnace alternatives.

• As reported by the International Renewable Energy Agency (IRENA), over 40% of developing countries lack the grid infrastructure to support large-scale EAF operations, limiting the market's penetration in such areas.

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ELECTRIC ARC FURNACES MARKET REGIONAL INSIGHTS

North America Has Propelled The Expansion Of EAF-Driven Steel Production To Drive Market Share 

In North America, notably the United States, has a strong foothold with a notable electric arc furnace market share. This is bolstered by the region's commitment to sustainability and recycling, which has propelled the expansion of EAF-driven steel production. EAF-produced steel finds substantial market share in the automotive and construction sectors.

KEY INDUSTRY PLAYERS

Multitude Of Companies That Played A Pivotal Role In the Expansion Of Electric Arc Furnaces

In the market, there were notable industry leaders known for their substantial influence and contributions. Nucor, as one of the United States' largest steel producers, holds a prominent position in the electric arc furnaces market share. Their reputation is built on a strong commitment to sustainability and their extensive utilization of electric arc furnaces technology.

• Primetals Technologies Limited (U.K.): According to the company’s 2023 technical release, Primetals installed an EAF system capable of producing 1.2 million tons of steel annually at a newly commissioned greenfield facility in Germany, reducing CO₂ emissions by 60% compared to legacy methods.

• Danieli (Italy): As reported in Danieli's official project summary, the company delivered over 250 EAF units worldwide as of 2023, including a high-efficiency furnace in Italy that cuts energy use by 20% per ton of steel compared to previous-generation models.

List of Top Electric Arc Furnaces Companies

• Primetals Technologies Limited (U.K.)
• Danieli (Italy)
• SMS group GmbH (Germany)
• IHI Corporation (Japan)
• SARRALLE (Spain)

REPORT COVERAGE

The future demand for the market is covered in this study. The Research report includes the Impact of Increased Demand for Scrap Steel among Population due to the Covid-19 Impact. The report covers the latest trends in Increased Focus on Sustainability. The paper includes a segmentation of the market. The research paper includes the driving factors that are Environmental Regulations to Fuel Market Growth. The report also covers information on Regional Insights where the region which has emerged leading market for electric arc furnaces.