CBAM was described as "an opportunity that EU steel mills have dreamed of" when MEPs discussed the additional costs associated with newly introduced emissions-based import taxes in the latest podcast, "Talking about Steel."
The December publication by the European Commission of EU emission benchmarks and country-specific default emission values, which play a central role in calculating CBAM taxes, should have brought clarity to steel market participants. Instead, his 1,600 pages of documents have left many importers in a state of constant uncertainty.
In the latest issue of the podcast "Talking about Steel", Head of the Price Analysis and Forecasts Department of MEPs Kay Ayub joins John Carruthers—Green, steel market analyst, and Tom Sharp, Managing editor, to talk about the consequences of the import duties imposed by CBAM on January 1.
The "Calculating the cost of Carbon" episode in "Talking about Steel" can be viewed right now on YouTube, Spotify or Apple Podcasts[url=https://podcasts.apple.com/us/podcast/speaking-of-steel-cbam-podcast-counting-the-cost-of-carbon/id1756464954?i=1000744831908]and reveals:
- The cost of CBAM taxes on the most imported steel products in the EU.
- How high the default emission values for a particular country have led enterprises to seek to verify the actual amount of carbon emissions.
- The developing EU carbon market: How the Emissions Trading Scheme (ETS) will affect CBAM costs).
- Details about the CBAM methodology and its possible development.
- The role of the European Commission as the initiator of the introduction of taxes on imports based on emissions, and whether others can be encouraged to follow its example.
Carruthers—Green said in a podcast interview that CBAM taxes on some of the EU's most imported steel products would make it unprofitable to purchase from some well-established foreign sources. This will change the structure of the steel supply chain in the EU. It will also open up new opportunities for domestic steel producers.
An opportunity that European businesses have dreamed of’
"This really gives European businesses the opportunity they've been dreaming of for the last few years. I think they will be very pleased with this," said Carruthers—Green
"This will give them a chance to start increasing their capacity, increase production, and increase their market share."
Ayub said that EU steel buyers will now evaluate all their supply options abroad as they seek to maintain a cost advantage after the introduction of CBAM taxes.
"They will need to calculate what all the CBAM fees are," she said. "If they buy, for example, a hot-rolled roll, they need to know what all the CBAM tariffs are.
