CBAM expectations weaken purchasing decisions in the steel market
As of December, price dynamics in the European steel market remained limited, with market attention increasingly shifting towards the European Union's Carbon Boundary Regulation Mechanism (CBAM), which will enter its final phase in 2026.
Market sources indicate that the uncertainty associated with CBAM has a direct impact on customer behavior, especially slowing down the decision-making processes of companies planning to build inventory or enter into long-term supply agreements.
It is reported that scrap availability in Europe is below normal levels due to expectations related to the introduction of CBAM in 2026, which provides limited support for scrap and flat-plate price increases. However, continued caution on the part of the end user prevented the establishment of a clear upward trend in prices.
Uncertainty about CBAM continues to put pressure on pricing and contract structure
According to market participants, CBAM continues to put pressure on pricing and contract negotiations. Although the goods will arrive in the EU in 2026, payments for carbon dioxide emissions are scheduled for 2027, which makes it difficult for importers to accurately predict costs at this stage. In addition, the lack of verified emissions data at the enterprise level has pushed default values to the forefront of cost calculations, while fluctuations in carbon prices in the EU ETS have increased the risk associated with fixed-price steel contracts.
Under these conditions, a significant part of buyers preferred to postpone making purchase decisions until January. Although the EU CBAM Committee approved the revised standard and baseline carbon intensity values on December 9, sources report that the impact on market activity has been limited. Maintaining the mechanism of phased penalties — at the level of 10% in 2026, 20% in 2027 and 30% from 2028 — reinforced the cautious position of the market.
European prices remain close to stable levels
As of December, prices for flat-rolled products in Europe tend to fluctuate in a narrow range. In Germany, prices for HRC are reported to be 610-620 euros per ton, CRC is 710-720 euros per ton, and hot-dip galvanizing (HDG) is 710-735 euros per ton. In Italy, prices for HRC are estimated at 595-600 euros per ton of EXW, while prices for CRC and HDG are in the range of 710-720 euros per ton of EXW.
.Market sources note that CRC prices, in particular, have received relative support due to a reduction in supply in the domestic market and production schedules, which are mostly completed by the end of the year. However, high inventory levels and cost uncertainty related to CBAM continue to hinder