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COMMENTS ON THE GLOBAL SUPPLY OF GRAIN ORIENTED ELECTRICAL STEELS

1. BACKGROUND

As the efficiency standard implemented in 2010 increased the use of low loss core materials, a higher 

standard will drive transformers towards even lower design inductions (requiring more core material per 

kVA output) and/or still lower loss core materials such as M2, ZDMH or Amorphous Metal. As a result, 

two questions were raised during subcommittee discussions concerning: 

(i) The ability of core materials manufacturers to supply “capable” products in sufficient volumes to meet 

demand.

(ii) Identifying an efficiency standard level that would be conducive to a well-supplied and competitively 

priced marketplace for core materials.

AK Steel was asked to provide comment on both matters. The following comment is a summary of public 

information on the capabilities of present GOES manufacturers. It should be noted that the information 

summarized in Table 1 regarding “product capability” and “production capacity” represent AK Steel’s best 

estimate as we lack specific information about our competitors’ production mix that would be needed for 

certainty. 

2. COMMENTS ON HIGH PERMEABILITY STEELS

There are three “general classes” of high permeability core material:

(i) Products for stacked core transformers1– NOPR references to “H-0” and “H-0 DR” both refer to AK 

Steel’s domain controlled (laser scribed) high permeability 9-mil product. AK Steel is the only domestic 

supplier of high permeability GOES products at this time. Similar products are supplied by other largevolume global suppliers such as Nippon Steel, JFE Steel and TKES with other manufacturers 

supplying lesser volumes. The OPS study evaluated AK Steel’s 9-mil H-0 CARLITE® DR® product.

(ii) Products for wound-&-annealed core transformers – NOPR references to “ZDMH” refer to a domain 

controlled high permeability GOES product intended for wound-&-annealed core transformers. These 

products are supplied by two Japanese steelmakers, Nippon Steel Corporation and JFE Steel 

Corporation, under the trade names “ZDMH” and “JGSD”, respectively, as 9-mil and 11-mil products

(Appendix A). We are uncertain which 9-mil grade (23ZDMH80 or 23ZDMH85) was evaluated by OPS.

(iii)Non-domain controlled products – the NOPR did not include M-0H in the analysis but these steels are 

widely used in stacked and wound-&-annealed core transformers. The specific grade of interest would 

be a 9-mil M-0H type (equivalent to AK Steel H-0 CARLITE).

Stacked core power transformer manufacturers are the largest users of high permeability steels. As ultrahigh-voltage power transformers are often “size-limited”, high permeability steels offer significant valueadded owing to much superior “kVA output per pound of transformer” and significantly reduced noise 

performance (transformer hum). Virtually all of AK Steel’s shipments of 9-mil H-0, 11-mil H-1 and 12-mil 

H-2 CARLITE and CARLITE DR go into this segment. Moreover, AK Steel’s present production capacity 

for H-0 CARLITE and H-0 CARLITE DR is fully committed (i.e., sold out) for the foreseeable future.

The power transformer market is robust for two main reasons: 

(i) Growing demand in the Developing World; and,

(ii) Replacement demand in the Developed World (mainly US, Canada and Europe). As a result, 

high permeability steels are in high demand worldwide. 

It should be noted that wound-&-annealed core transformers are peculiar to specific regions of the global 

market (mainly USA, Canada, Mexico, Japan and Taiwan; secondarily, India). These transformer designs 

represent a small segment, about 5-10%, of the global transformer market.

 

1 See Appendix A (AK Steel, Nippon Steel and JFE Steel product specifications for domain controlled high permeability products).
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3. AVAILABILITY BY GRADE TYPE

Given the charge from the working group to identify the standard level that is conducive to a well-supplied 

and competitively priced marketplace for core material buyers, we offer the following comments

M2 – M2 is a 7-mil product produced only in the USA by AK Steel and ATI. AK Steel’s process requires a 

more precise (narrower range) in melt chemistry for M2 than M3 requires.

M3/M-0H2– M3/M-0H are 9-mil products (M3 is a conventional type; M-0H is a high permeability type) 

which are functionally interchangeable in most distribution transformer designs. These are the most 

widely available high grade GOES products with a large global production base. In the USA, AK Steel 

and ATI both have ample M3 manufacturing capability and capacity. This is complemented by M3/M-0H 

capable large-volume suppliers like Nippon Steel, JFE Steel and TKES and smaller-volume capable 

producers including StalProdukt (PL), Cogent (UK) and Aperam (BR). We anticipate that large-volume 

suppliers NLMK (RU), Wuhan Steel (CN) and Baosteel (CN) will develop M3/M-0H capability in the future. 

“H-0 DR” – H-0 DR is a domain controlled high permeability product for use in stacked core transformers. 

AK Steel is the only domestic supplier of laser scribed high permeability GOES products at this time. 

Similar products are available from other capable large-volume suppliers such as Nippon Steel, JFE Steel 

and TKES. Other manufacturers make lesser amounts but their production is expected to grow rapidly. 

“ZDMH” – Japanese supply capacity is unknown. AK Steel positioned M2 LITE CARLITE® for this 

segment and has proprietary information showing that M2-LC performs comparably to ZDMH in most 

wound-&-annealed core transformer designs. 

4. GOES CAPACITY/CAPABILITY 

Table I summarizes the capability and total (all types combined) capacity for the established producers. 

0.007 0.009 0.011 0.012 0.014 0.009 0.011 0.012 0.009 0.011 0.012 0.009 0.011 0.012

RGO+TCH, 

mt/yr

TCH-Only, 

mt/yr M-2 M-3 M-4 M-5 M-6 H-0 H-1 H-2 H-0 DR

H-1 

DR

H-2 

DR

Americas Aperam Inox Brazil (Acesita) Brazil 60,000 - - - X X X - - - - - - - - - - - - - - - - - - - - 

AK Steel USA 305,000 120,000 X X X X X x X X X X x - - - - - - 

Allegheny Ludlum USA 100,000 - X X X X X - - - - - - - - - - - - - - - - - - 

Asia Wuhan China 420,000 100,000 - - x X X x x x x x x x - - - - - - 

Baosteel China 160,000 50,000 - - x X X - - X X X x X X - - - - - - 

TKES-Nashik India 30,000 - - - - - X X - - - - - - - - - - - - - - - - - - - - 

JFE Steel Corp. Japan 160,000 110,000 - - X X X X X X X X X - - X X - - 

Nippon Steel Corp. Japan 330,000 250,000 - - X X X X X X X X X - - X X - - 

Pohang Iron & Steel Co. Korea 250,000 150,000 - - - - X X X x X X X X X - - - - - - 

Europe Mittal Steel-VPFM Czech 75,000 - - - x x X X - - - - - - - - - - - - - - - - - - 

Mittal Steel-Stalprodukt Poland 100,000 - - - x X X X x x x x x x - - - - - - 

NLMK/VIZ Stal Russia - - x X X X - - X X - - X X - - - - - - 

TKES France, 

Germany 260,000 130,000 - - x X X X X X X X X X - - - - - - 

Cogent-Orb Works UK 100,000 15,000 - - x X X X x X X x x x - - - - - - 

2,690,000 1,105,000

 340,000 180,000

Conventional or Regular 

Grain Oriented 

2010-2012

Production Capacity

TOTAL CAPACITY

Region Producer Country

Product Thickness

Domain Refined

Stacked Cores

Table I: Grain Oriented Capacity and Product Capability by Region and Company 

Estimated installed capacity for 2011-2014, all in metric tons

High Permeability Grain Oriented

Estimated Product Capability of GOES Producers

(x=limited availability, X=high availability)

Domain Refined Wound-&-

Annealed Cores

Non-Domain 

Refined 

(M-0H types)

For the 2011-2014 timeframe, we estimate GOES production capacity at about 2.7MM mt/yr. We estimate 

that 2011 global demand is about 2.1-2.2MM tpy, resulting in significant unused capacity from expansion 

projects started when pre-recession GOES demand was very high.

 

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The “M-0H” designation does not exclusively define a 9-mil product (see last page of the JFE product information). 
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5. COMMENTS ON AMORPHOUS METALS

At this time, there are two established manufacturers of amorphous metal strip. Information about the 

Hitachi Metals Group and its US subsidiary, Metglas Inc., is well known. Appendix II contains information 

from the web site of Advanced Technology & Materials (AT&M) Company. Ltd., of China. AT&M supplies 

about 40,000 mt/yr of amorphous strip, including magnetic grades which are sold under the trade name 

Antaimo® for use in transformers. AM&T also produces nanocrystalline magnetic materials which are 

sold under the name Antaimano®.Appendix II provides a brief history of AT&M (page 1). AT&M was 

established as a Chinese government enterprise in 1998 with a substantial technical staff cited (4th

paragraph on page 1) and links to Chinese state engineering enterprises. 

Based on product information on the AT&M web site, they produce Antaimo as cast strip in widths of 64

and 100 mm (21⁄2 and 4 inches) as shown under “specifications” section (Appendix II page 2). The specific 

amount of Antaimo being supplied is not stated but applications cited on the AT&M product information 

are cite use as small (narrow width) high frequency transformer power cores.

6. RECOMMENDATIONS

DL-1 to DL-5: Given that M2 and ZDMH are “limited availability products” with only three or four suppliers 

worldwide, we believe that GOES manufacturers would concur with AK Steel’s view that any enhanced 

standard be based on M3/M-0H. 

DL-9 to DL-13: Given that the supply of M3/M-0H would be largely consumed for DL-1 to DL-5 

transformers, we believe that GOES manufacturers would concur with our view that an enhanced

standard should be based on M4 to ensure that core materials would be widely available.

Submitted by:

Jerry W. Schoen

Principal Engineer

Research & Technical Services

AK Steel Corporation

705 Curtis Street

Middletown, OH 45043-0001

USA