A process for the manufacture of soft magnetic composite components is provided comprising the steps of die compacting a powder composition comprising a mixture of soft magnetic, iron or iron-based powder, the core particles of which are surrounded by an electrically insulating, inorganic coating, and an organic lubricant in an amount of 0.05 to 1.5% by weight of the composition, the organic lubricant being free from metal and having a temperature of vaporisation less than the decomposition temperature of the coating; ejecting the compacted body from the die; heating the compacted body in a non-reducing atmosphere to a temperature above the vaporisation temperature of the lubricant and below the decomposition temperature of the inorganic coating for removing the lubricant from the compacted body, and subjecting the obtained body to heat treatment at a temperature between 300° and 600° in water vapour. The invention also concerns soft magnetic composite components having a transverse rupture strength of at least 100 MPa, a permeability of at least 700, and a core loss at 1 Tesla and 400 Hz of at most 70 W/kg.