EU steel importers have expressed concern that CBAM will lead to significantly higher costs than previously anticipated.
The documentation, which has not yet been officially published by the European Commission, shows that its CBAM committee has adopted a number of changes to previously published draft implementation proposals. These include lower final emission baselines, above which CBAM taxes will be levied at 100% of the carbon value determined under the EU Emissions Trading Scheme (ETS)).
The changes have also led to an increase in some of the country-specific CBAM emission standards. These fixed values, which apply to both finished steel and semi-finished products, vary by country and production route and should be used to determine CBAM taxes in the absence of verified plant data.
Preliminary calculations based on these factors show that CBAM taxes will make imports from certain countries uncompetitive. The cost of materials produced in blast furnaces, particularly in China, India and Indonesia, is likely to be significant.
EU plants will be able to realize the benefits of CBAM after difficult operating conditions in 2025
Clarifications The potential costs that will arise just a few weeks before the mechanism goes into effect on January 1 will be welcomed by most steel producers in the EU. Some of them have already started long Christmas shutdowns in the hope that CBAM taxes will lead to higher demand and prices in the new year.
- This article first appeared in the European Steel Review by MEPS International. The monthly review features steel prices, indexes, comments, and forecasts for Belgium, France, Germany, Italy, Spain, and the United Kingdom.[url= / / / /gb/en/pages/contact-meps]Contact the MEPs for detailed information on how to subscribe.
According to the European Commission, during the 12-month period of subdued domestic demand and unstable international trade, the factories' production capacities were loaded by 60-67%. Worldsteel data showed that crude steel production in the 27 EU countries that the company tracks decreased by 3.4% year-on-year to the end of October, to 107.7 million tons. The volume of production at German factories in the first 10 months of this year decreased by 9.9%, to 28.5 million tons.
Global steel production decreased by 2.1% to 1.52 billion tons over the same period. This overall decrease was largely due to a 3.9% decrease in production (to 817.9 million tons) in China.
U.
S. President Donald Trump's complete reintroduction of Section 232 steel tariffs in March
