AC (Alternative Current) Electric Arc Furnace (EAF) Market Size, Share, Growth, and Industry Analysis, By Types (High-voltage AC, Low-voltage AC), By Applications (Metal Smelting, Ore Smelting, Others) , and Regional Insights and Forecast to 2034

AC (Alternative Current) Electric Arc Furnace (EAF) Market Size

The Global AC (Alternative Current) Electric Arc Furnace (EAF) Market size was USD 0.53 billion in 2024 and is projected to reach USD 0.56 billion in 2025, USD 0.6 billion in 2026, expanding further to USD 0.93 billion by 2034. The market is forecasted to grow at a CAGR of 5.7% during 2025–2034. With over 65% of global secondary steel production relying on AC EAFs, the demand continues to rise as 58% of manufacturers emphasize reduced energy consumption, while 60% focus on sustainable practices and carbon reduction strategies.

The US AC (Alternative Current) Electric Arc Furnace (EAF) Market is experiencing strong growth as 67% of domestic steel production relies on EAF technology. Around 54% of installations use AC-based furnaces, supported by 42% of companies adopting advanced automation for better performance. Nearly 48% of steel producers in the US highlight efficiency improvements, while 36% focus on expanding scrap-based operations, reinforcing the country’s leadership in sustainable steelmaking.

Key Findings

• Market Size: $0.53 billion (2024), $0.56 billion (2025), $0.93 billion (2034), 5.7% growth projected during the forecast period.
• Growth Drivers: Over 70% focus on energy efficiency, 62% reduction in emissions, 55% new installations eco-focused, 41% invest in automation.
• Trends: 65% adoption in secondary steel, 58% reduced electrode use, 60% carbon reduction focus, 55% ultra-high power EAF preference.
• Key Players: Danieli, Electrotherm, SMS, Siemens, TENOVA & more.
• Regional Insights: Asia-Pacific holds 42% on surging infrastructure and scrap utilization; Europe 28% led by circular-economy upgrades; North America 20% driven by recycling and automation; Middle East & Africa 10% supported by industrial expansion and construction demand.
• Challenges: 60% cite scrap supply issues, 50% report high costs, 42% face raw material quality concerns, impacting steady growth and operations.
• Industry Impact: 62% lower emissions, 70% higher efficiency, 48% automation adoption, 55% sustainable steel capacity expansion worldwide.
• Recent Developments: 33% efficiency gains, 28% lower electrode wear, 25% lower power fluctuations, 27% reduced CO₂, 22% lower costs achieved through innovations.

The AC (Alternative Current) Electric Arc Furnace (EAF) Market is characterized by rapid modernization and strong adoption across industries. More than 66% of applications are in metal smelting, supported by 55% growth in scrap utilization and 62% alignment with decarbonization goals. Around 47% of smaller producers face investment barriers, yet 41% of global manufacturers are pushing technological upgrades. This balance of challenges and opportunities highlights the strategic role of AC EAFs in shaping future sustainable steelmaking trends.

AC (Alternative Current) Electric Arc Furnace (EAF) Market Trends

The AC Electric Arc Furnace (EAF) market is witnessing a transformative shift with steelmakers increasingly adopting advanced furnace technologies to boost efficiency and reduce energy costs. Over 65% of global steel production using scrap relies on EAF technology, where AC-based furnaces account for a significant portion due to their operational simplicity and cost advantages. Approximately 72% of medium and small-scale steel manufacturers prefer AC EAFs, reflecting their affordability and adaptability compared to DC alternatives. The industry has also seen a 40% improvement in energy efficiency levels as modern AC EAFs integrate with digital monitoring and automation systems. Around 58% of plants using AC furnaces report reduced electrode consumption, enhancing operational sustainability. Additionally, over 60% of global players are investing in eco-friendly AC EAFs to align with carbon neutrality targets, driving demand for sustainable production methods. The adoption of ultra-high power AC EAFs is also growing, with more than 55% of operators favoring them for increased productivity and flexible output capacities, establishing strong momentum in the global market.

AC (Alternative Current) Electric Arc Furnace (EAF) Market Dynamics

OPPORTUNITY

Growth in Sustainable Steelmaking

Nearly 68% of global steelmakers are shifting toward environmentally friendly production methods, with AC EAFs playing a central role. Around 55% of new steel capacity installations focus on scrap-based AC furnaces, reducing reliance on traditional blast furnace operations. Moreover, 62% of operators highlight significant reductions in CO₂ emissions using modern AC EAFs, making them critical for green transition strategies.

DRIVERS

Rising Demand for Energy Efficiency

Over 70% of steel producers highlight energy efficiency as a key driver in adopting AC EAFs. Plants using upgraded AC furnaces report up to 35% lower power consumption compared to conventional methods. Additionally, nearly 64% of facilities indicate reduced electrode wear and maintenance costs, reinforcing the operational and economic benefits of AC-based electric arc furnace systems worldwide.

RESTRAINTS

"High Infrastructure and Operational Costs"

Around 52% of smaller steel producers cite high installation costs of AC EAFs as a limiting factor. Nearly 47% of industry players emphasize challenges in managing frequent maintenance cycles, which can increase downtime. Moreover, 50% of operators highlight the rising prices of electrodes and consumables, restricting widespread adoption of AC EAFs, especially in developing markets where capital expenditure remains constrained.

CHALLENGE

"Fluctuating Scrap Availability"

Nearly 60% of global AC EAF operators identify inconsistent scrap supply as a major challenge, affecting furnace utilization rates. About 42% of steelmakers report that scrap impurities lead to lower yield and additional refining costs. Furthermore, 48% of industry stakeholders emphasize that regional imbalances in scrap collection and processing restrict the steady operations of AC furnaces, creating a key challenge for the market growth trajectory.

Segmentation Analysis

The Global AC Electric Arc Furnace (EAF) Market size was USD 0.53 Billion in 2024 and is projected to reach USD 0.56 Billion in 2025, expanding further to USD 0.93 Billion by 2034 at a CAGR of 5.7%. By type, High-voltage AC and Low-voltage AC segments contribute differently to growth, with each holding distinct advantages in steel and alloy processing. In 2025, High-voltage AC accounted for the majority share due to its large-scale industrial applications, while Low-voltage AC captured a significant portion driven by its adaptability in small and medium facilities. By application, Metal Smelting dominated the market, followed by Ore Smelting and Others, each contributing their respective market size and CAGR growth trajectory across different geographies and operational needs.

By Type

High-voltage AC

High-voltage AC furnaces dominate in large-scale industrial steel production, offering superior efficiency and lower energy consumption compared to traditional processes. Nearly 63% of global large-capacity EAF installations utilize high-voltage systems for better performance and reliability.

High-voltage AC held the largest share in the global AC EAF market, accounting for USD 0.33 Billion in 2025, representing nearly 59% of the total market. This segment is projected to expand at a CAGR of 6.1% during 2025–2034, supported by rapid industrialization, rising scrap utilization, and modernization of steel plants.

Major Dominant Countries in the High-voltage AC Segment

• China led the High-voltage AC segment with a market size of USD 0.12 Billion in 2025, holding a 36% share and expected to grow at a CAGR of 6.4% due to strong steel demand and government-backed infrastructure projects.
• India followed with USD 0.09 Billion in 2025, representing a 27% share and anticipated to grow at a CAGR of 6.3%, driven by expanding construction and automotive industries.
• Germany accounted for USD 0.06 Billion in 2025 with an 18% share, forecasted to grow at a CAGR of 5.9% owing to technological upgrades and sustainability policies.

Low-voltage AC

Low-voltage AC furnaces are preferred by small and medium-scale steel manufacturers due to their cost-effectiveness and flexibility. Around 54% of emerging markets utilize low-voltage AC EAFs, offering scalability and reduced upfront investment for regional players.

Low-voltage AC accounted for USD 0.23 Billion in 2025, representing nearly 41% of the total market. This segment is projected to grow at a CAGR of 5.1% from 2025 to 2034, driven by rising adoption among mid-sized producers and increasing demand for affordable and energy-efficient solutions.

Major Dominant Countries in the Low-voltage AC Segment

• Brazil led the Low-voltage AC segment with a market size of USD 0.07 Billion in 2025, holding a 30% share and expected to grow at a CAGR of 5.3% due to its growing scrap recycling industry and expanding industrial base.
• Turkey accounted for USD 0.05 Billion in 2025, representing a 22% share, projected to grow at a CAGR of 5.2% supported by strong export-led steel production.
• Italy captured USD 0.04 Billion in 2025 with a 19% share, forecasted to grow at a CAGR of 5.0% owing to modernization of its domestic steelmaking facilities.

By Application

Metal Smelting

Metal Smelting is the largest application of AC EAFs, with more than 66% of total demand attributed to this segment. The efficiency of AC EAFs in handling diverse scrap qualities makes them the most reliable choice for steelmakers focusing on secondary production.

Metal Smelting accounted for USD 0.37 Billion in 2025, representing 66% of the global market. This application is expected to grow at a CAGR of 6.0% during 2025–2034, supported by increased infrastructure development and rising demand for recycled steel products.

Top 3 Major Dominant Countries in the Metal Smelting Segment

• China led the Metal Smelting segment with a market size of USD 0.15 Billion in 2025, holding a 41% share and projected to grow at a CAGR of 6.3% due to high domestic steel demand.
• India accounted for USD 0.09 Billion in 2025 with a 24% share, expected to grow at a CAGR of 6.1% supported by rapid urbanization and construction sector growth.
• United States held USD 0.07 Billion in 2025, representing 19% share, forecasted to grow at a CAGR of 5.7% with strong focus on sustainable steel recycling initiatives.

Ore Smelting

Ore Smelting represents a significant share of the AC EAF market as these furnaces are capable of processing various ores efficiently. Around 29% of AC EAF installations globally are dedicated to ore smelting, with steady adoption across emerging economies.

Ore Smelting was valued at USD 0.13 Billion in 2025, accounting for 23% of the market. This segment is anticipated to grow at a CAGR of 5.2% between 2025 and 2034, supported by rising investments in mining and metal extraction industries.

Top 3 Major Dominant Countries in the Ore Smelting Segment

• Australia led the Ore Smelting segment with a market size of USD 0.04 Billion in 2025, holding a 31% share and forecasted to grow at a CAGR of 5.4% driven by its mineral-rich reserves.
• South Africa captured USD 0.03 Billion in 2025, representing a 23% share, expected to grow at a CAGR of 5.1% owing to strong ore-based industrial output.
• Russia accounted for USD 0.02 Billion in 2025, holding 19% share and projected to grow at a CAGR of 5.0% due to increasing modernization of its smelting operations.

Others

The Others segment includes specialized applications such as alloy production, foundries, and recycling plants. Around 12% of AC EAF installations are attributed to this category, highlighting its niche yet growing role in global steel and alloy manufacturing.

Others accounted for USD 0.06 Billion in 2025, representing 11% of the global market. This application is forecasted to grow at a CAGR of 4.9% from 2025 to 2034, driven by demand in smaller industries and specialized alloy producers.

Top 3 Major Dominant Countries in the Others Segment

• Japan led the Others segment with a market size of USD 0.02 Billion in 2025, holding a 34% share and expected to grow at a CAGR of 5.1% due to high-tech alloy production.
• South Korea accounted for USD 0.015 Billion in 2025, representing 25% share, projected to grow at a CAGR of 5.0% with strong industrial demand for advanced materials.
• Mexico held USD 0.012 Billion in 2025, capturing 20% share and forecasted to grow at a CAGR of 4.8% driven by expanding foundry operations.

AC (Alternative Current) Electric Arc Furnace (EAF) Market Regional Outlook

The Global AC Electric Arc Furnace (EAF) Market size was USD 0.53 Billion in 2024 and is projected to reach USD 0.56 Billion in 2025, further expanding to USD 0.93 Billion by 2034 at a CAGR of 5.7%. Regionally, Asia-Pacific dominated the market with the largest share, followed by Europe, North America, and Middle East & Africa. In 2025, Asia-Pacific accounted for 42% of the total market, Europe contributed 28%, North America represented 20%, and Middle East & Africa held 10%. This distribution highlights the global dependence on scrap-based steel production and the increasing role of AC EAFs in sustainable manufacturing.

North America

North America has a strong presence in the AC EAF market due to its mature steel recycling infrastructure and focus on sustainability. Nearly 65% of steel production in the U.S. relies on EAF technology, with AC furnaces contributing significantly. Canada has also reported a 48% adoption rate in secondary steel production facilities. Mexico’s steel industry has expanded steadily, with nearly 36% of mid-scale plants utilizing AC EAFs to improve operational efficiency and reduce energy costs.

North America held USD 0.11 Billion in 2025, representing 20% of the total market. This segment is expected to grow steadily from 2025 to 2034, driven by rising demand for recycled steel, government-backed decarbonization programs, and continued modernization of steel plants.

North America - Major Dominant Countries in the AC EAF Market

• United States led with a market size of USD 0.06 Billion in 2025, holding a 55% share and expected to grow due to large-scale recycling facilities and automotive sector demand.
• Canada accounted for USD 0.03 Billion in 2025, with a 27% share, supported by investments in eco-friendly steel production.
• Mexico held USD 0.02 Billion in 2025, representing 18% share, driven by growth in construction and mid-sized steel producers.

Europe

Europe’s AC EAF market is shaped by strict environmental regulations and a focus on circular economy practices. Nearly 72% of mini-mills in Europe use AC-based furnaces, contributing to reduced carbon emissions. Germany accounts for over 34% of the regional adoption, while Italy and France have reported consistent growth in EAF installations, each exceeding 20% usage in total steel output. Increasing emphasis on carbon-neutral steel is further driving adoption.

Europe accounted for USD 0.16 Billion in 2025, representing 28% of the global market. Growth is supported by the EU’s Green Deal, modernization of existing plants, and the shift toward energy-efficient steel production processes.

Europe - Major Dominant Countries in the AC EAF Market

• Germany led the market with USD 0.06 Billion in 2025, representing 38% share, driven by advanced technologies and green steel demand.
• Italy accounted for USD 0.05 Billion in 2025, holding 31% share, supported by strong foundry operations.
• France captured USD 0.03 Billion in 2025, representing 19% share, due to investments in low-emission steel production.

Asia-Pacific

Asia-Pacific dominates the global AC EAF market due to its large-scale steel production capacity. China alone contributes more than 58% of the region’s AC EAF installations, with growing emphasis on scrap utilization and energy-efficient processes. India is witnessing rapid adoption, with nearly 40% of its new steel plants opting for AC EAFs. Japan has reported a 22% penetration rate, focusing on high-quality alloy and specialty steel through AC furnaces.

Asia-Pacific held USD 0.23 Billion in 2025, representing 42% of the global market. Growth is fueled by urbanization, infrastructure development, and government policies encouraging eco-friendly steelmaking technologies.

Asia-Pacific - Major Dominant Countries in the AC EAF Market

• China led with USD 0.13 Billion in 2025, accounting for 56% share, driven by industrial capacity and recycling initiatives.
• India followed with USD 0.06 Billion in 2025, representing 26% share, supported by construction and automotive sectors.
• Japan held USD 0.03 Billion in 2025, accounting for 13% share, with focus on technological upgrades in alloy steel production.

Middle East & Africa

The Middle East & Africa market for AC EAFs is developing steadily, supported by investments in industrial infrastructure and growing reliance on secondary steel production. Turkey leads the region with over 48% usage of AC EAFs in its steel sector. The UAE and Saudi Arabia are increasingly investing in modern furnace technologies, with adoption rates of 22% and 18% respectively. South Africa also contributes with rising utilization in ore smelting operations.

Middle East & Africa accounted for USD 0.06 Billion in 2025, representing 10% of the total market. Growth is driven by government initiatives in industrial expansion, increased scrap collection, and regional demand for construction-grade steel.

Middle East & Africa - Major Dominant Countries in the AC EAF Market

• Turkey led with USD 0.03 Billion in 2025, holding 48% share, driven by strong export-led steel production.
• UAE captured USD 0.01 Billion in 2025, representing 22% share, supported by industrial diversification policies.
• Saudi Arabia accounted for USD 0.01 Billion in 2025, with an 18% share, driven by infrastructure growth under Vision 2030 projects.

List of Key AC (Alternative Current) Electric Arc Furnace (EAF) Market Companies Profiled

Investment Analysis and Opportunities in AC (Alternative Current) Electric Arc Furnace (EAF) Market

Investments in the AC EAF market are expanding rapidly, with over 62% of steel producers increasing capital allocation towards modernization projects. Nearly 48% of ongoing investments target automation and digital monitoring systems to enhance performance and lower energy losses. Additionally, 55% of opportunities are concentrated in Asia-Pacific, where growing urbanization and industrialization fuel high demand. In Europe, nearly 38% of projects focus on low-carbon steelmaking, aligning with strict emission norms. Around 41% of global manufacturers are channeling resources into energy-efficient designs, while 29% are entering partnerships for raw material recycling initiatives, creating new avenues for expansion.

New Products Development

The development of new AC EAF products is reshaping the market, with over 46% of launches focusing on ultra-high power furnaces that optimize scrap-to-steel conversion. Approximately 51% of innovations target reduced electrode consumption and improved arc stability, ensuring cost-effective operations. Around 39% of manufacturers are introducing hybrid designs integrating renewable energy for sustainable steelmaking. Moreover, 42% of companies are deploying digital twin technology to achieve predictive maintenance and process optimization. These advancements highlight the industry’s shift towards performance-driven, eco-friendly, and technologically advanced AC EAF systems catering to evolving global demand.

Recent Developments

• Danieli Smart Furnace Upgrade: In 2024, Danieli introduced a smart AC EAF system that enhanced energy efficiency by 33% and reduced electrode wear by 28%, supporting sustainability-focused steel producers.
• SMS Digital Arc System: SMS launched a digital arc optimization solution in 2024, enabling 30% faster melting times and improving operational stability for large-capacity furnaces.
• Siemens Hybrid Control Platform: Siemens integrated a hybrid AC EAF control system in 2024, achieving 25% lower power fluctuations and enhancing production consistency in European plants.
• TENOVA Low-Emission Furnace: In 2024, TENOVA developed an advanced AC furnace model that cut CO₂ emissions by 27% and improved scrap utilization by 34%, aligning with green transition goals.
• Electrotherm Compact EAF: Electrotherm released a compact AC furnace model in 2024, designed for small and mid-sized producers, offering 22% cost savings and 19% reduced operational downtime.

Report Coverage

The AC Electric Arc Furnace (EAF) Market report provides comprehensive coverage with detailed insights into growth opportunities, competitive positioning, and key drivers shaping the global landscape. Strengths include wide adoption of AC EAF technology, with nearly 65% of secondary steel production relying on it globally, and strong sustainability alignment where 62% of users report significant emission reductions. Weaknesses lie in high infrastructure and maintenance costs, highlighted by 47% of smaller producers citing investment barriers. Opportunities are abundant, as 55% of new installations are focused on eco-friendly solutions and 41% of manufacturers are investing in automation to boost efficiency. However, challenges remain, with nearly 60% of operators facing inconsistent scrap supply and 42% reporting issues with raw material quality. Regionally, Asia-Pacific dominates with 42% market share, Europe follows with 28%, North America contributes 20%, and Middle East & Africa holds 10%. The competitive landscape highlights Danieli and SMS as key leaders, jointly holding over 33% of the market, while other players drive innovation through niche and regional strategies. This coverage provides a strategic outlook for stakeholders assessing long-term opportunities in AC EAF technology.