ACEA: CBAM implementation at risk amid regulatory delays
The European Automobile Manufacturers’ Association (ACEA) has warned that with just two months remaining before the final implementation phase of the Carbon Border Adjustment Mechanism (CBAM) in 2026, the continued absence of key legislation is creating serious uncertainty.
In a statement issued in Brussels, the European Automobile Manufacturers’ Association (ACEA) said that automotive producers have already devoted significant resources to CBAM reporting and are preparing to fully comply once the mechanism enters into force. However, the association warned that with CBAM charges due to apply from January 2026, many critical implementation details remain unknown, creating growing concern across the sector.
According to ACEA, the automotive industry is among the sectors most affected by CBAM. European manufacturers import large volumes of steel and aluminium, and accurate reporting of embedded carbon emissions in these materials is essential for the mechanism’s proper functioning.
ACEA underlined that the European Commission has yet to publish guidance on key elements such as emission calculation methodologies, default values, the sale and repurchase of CBAM certificates, and the role of accredited verifiers.
ACEA Director General Sigrid de Vries stated: “Automakers are committed to making CBAM work and have already invested heavily in compliance operations. But the fact that such critical aspects remain unclear makes a smooth implementation on 1 January 2026 almost impossible. The Commission must urgently publish the missing texts and provide flexibility for businesses in the coming year.”
OECD Steel Committee: Global overcapacity hits record levels as China’s exports surge
At the 98th session of the OECD Steel Committee, held in Paris on 4-5 November 2025, a total of 249 government and industry representatives from 43 delegations gathered to discuss the structural challenges of the global steel market and potential policy responses. The meeting warned that rising overcapacity and non-market practices are once again destabilizing international trade.
In a joint statement, Committee Vice-Chairs Sheryl Groeneweg and Lieven Top noted that China’s steel exports have increased by 10% this year, reaching record levels. They emphasized that this surge has negatively affected producers and workers in market-based economies, weakening the financial performance of companies. The statement also revealed that around one-fifth of planned low-carbon steel projects worldwide have been suspended due to unfavorable market conditions and unfair competition.
According to OECD data, global steel overcapacity could exceed 680 million tons in 2025. Global crude steel production capacity has been rising for seven consecutive years and is expected to reach 2.547 billion tons by the end of the year. With additional projects scheduled to come online by 2028, the figure could climb to 2.656 billion tons. Most capacity expansions are concentrated in Asia and the Middle East, particularly in India and ASEAN countries.
Delegates highlighted that non-market measures—including energy subsidies, tax exemptions, low-interest loans, and preferential treatment for state-owned enterprises—are distorting competition and allowing inefficient plants to remain operational. The OECD’s monitoring report identified China, the Middle East–North Africa (MENA) region, and Southeast Asia as the areas where such practices are most prevalent. The Committee stated that these policies “distort market signals and discourage private investment.”
Trade distortions linked to overcapacity persist despite existing safeguard measures, the report noted. Chinese producers have reportedly increased exports of semi-finished and low value-added steel products to circumvent trade restrictions on finished goods, leaving Asian, African, and Latin American markets increasingly exposed.
Participants agreed on the need for more coordinated global action under the Global Forum on Steel Excess Capacity (GFSEC) framework. Referring to the resolutions adopted at the October GFSEC Ministerial Meeting, the Committee reaffirmed the goal of establishing a joint policy framework by June 2026 to address the structural roots of the global steel crisis. It also stressed that reducing excess capacity would not only restore market stability but also accelerate investments in low-carbon steel technologies.
German ‘steel dialogue’ highlights competitive electricity supply importance
The German government will lobby the European Commission for measures to support the German steel industry, as its existence is under threat, while competitive electricity supply remains critical, German Chancellor Friedrich Merz said after the “c” he hosted in Berlin on Thursday.
“The European Commission’s [EC] recent proposals for effective protection of the steel industry are a step in the right direction,” he said. Meanwhile, “without a significant reduction in energy costs, this [steel] industry in Germany would not be able to survive.”
“Politicians must do everything in their power to preserve the industry,” he continued, adding that local manufacturers should be protected and their transformation to climate-neutral production supported.
The German government has already implemented steel industry support measures. These include the abolition of the gas storage levy, the reduction of electricity tax to the EU minimum and the reduction of transmission grid charges, by €6.5 billion ($7.5 billion) in 2026 alone, the government notes.
It is also lobbying the European Commission for further relief in order to maintain the competitiveness of the steel industry and keep it on its path towards climate neutrality. Specifically, the so-called electricity price compensation is to be expanded and an industrial electricity price is to be implemented, Kallanish notes.
In contrast to the industrial electricity price, the electricity price compensation would provide additional relief for the steel industry through an increase in the aid intensity expressly demanded by the German government.
The government meanwhile continues to work intensively to end exemptions from sanctions for semi-finished steel imports from Russia, with plans to rigorously prosecute any attempts at circumvention.
German finance minister Lars Klingbeil said: “We must continue to reduce energy costs and improve the conditions of competition and give a clear European response to global overcapacity and dumping prices. We want a clear focus on climate-friendly quality steel from Germany and Europe. For our infrastructure and defence, in the automotive industry and in other important areas, we want domestic and European steel to be used as a priority.”
The steel dialogue participants agreed consistent measures are needed to address the negative effects of global overcapacity and the threat of trade diversion to the EU market. “To this end, the EU must exhaust its trade policy possibilities. What is needed is a robust, balanced successor to the safeguards that expires on 30 June 2026 that complies with WTO law,” the government notes.
In addition, it supports the EC’s efforts to negotiate easing US tariffs on steel and aluminium, including derivatives, so that European goods can be exported to the USA using duty-free quotas.
The German government advocates CBAM’s extension to downstream steel products and calls on the Commission to present a model for WTO-compliant export compensation in the near future. Should effective carbon leakage protection via CBAM or compensation payments prove unsuccessful, competitiveness should continue to be regulated through the free allocation of allowances, it adds.
The German Steel Association – WV Stahl – meanwhile called on politicians to act quickly. “There should be no more time lost and at least lower industrial electricity prices should be introduced as quickly as possible,” it urges.
WV Stahl is seeking fair competition instead of market distortion, and has called on the government to lobby Brussels to introduce robust trade protection against price dumping and overcapacity as quickly as possible.
“Competitive energy prices require a permanent reduction of network charges, continuation and deepening of electricity price compensation, and in the medium term, the introduction of a reliable industrial electricity price to keep investments in the country,” the association says.
Svetoslav Abrossimov Bulgaria
China exports intensify displacement, low-emission transition concerns: OECD
Concerns are intensifying, amid new record levels of Chinese steel exports, over the displacement of businesses and workers in market-oriented economies, and existing and new lower-emissions projects being increasingly put on hold, concluded the OECD Steel Committee after its 98th session in Paris this week.
Non-market policies and practices by some countries are distorting steel prices, reducing the steel market shares of member countries, creating severe trade disruptions, and leading to national and economic security risks, the committee notes.
International steel market conditions have weakened since the Committee last met in spring, though the downturn is starting to moderate. Following three consecutive years of contraction from 2022 to 2024, global steel demand appears to be bottoming out in 2025, the Committee says, echoing worldsteel’s October short-range outlook.
Projections for 2026 indicate a modest recovery of just over 1%, which would return global demand to its 2022 level. While demand in China is expected to decline sharply, developed economies are poised for a gradual rebound, it adds.
“In China, while steel capacity replacement rules are being tightened, enforcement challenges raise questions regarding the possibility of further net capacity increases. At the same time, Chinese steel companies, including state-owned enterprises, continue to invest in steel projects overseas, especially in ASEAN and Africa,” Committee vice chairs Sheryl Groeneweg and Lieven Top note in a statement seen by Kallanish.
“The structural decline in Chinese steel demand is pushing its domestic steel producers to export record volumes of steel rather than undertake market-oriented reforms and remove such capacity, thereby reshaping international trade flows via different channels,” they add.
Responding to increasing trade measures, Chinese mills have expanded shipments of semi-finished and lower-value products, which are less exposed to such measures. This shift has allowed overall export volumes to remain elevated, while leaving less protected markets – particularly in Asia, Africa and Latin America – more vulnerable to displacement and price competition, the Committee continues.
Government support measures including market-distorting subsidies are increasingly prominent in regions where steelmaking capacity is rapidly expanding, such as in the Middle East and North Africa (MENA), China, and ASEAN, it adds.
“The Committee’s latest monitoring exercise shows that common channels of support in MENA include subsidised energy, tax and customs exemptions, concessional loans, preferential treatment of SOEs, preferential public procurement and local content requirements,” the Committee notes. “Such subsidies have significant adverse effects on members’ steel industries.”
Subsidised firms in non-member economies are increasing their market shares to the detriment of competitors in member countries, it adds.
Several announced projects, corresponding to 19% of the total expected lower-emission project pipeline until 2027, have meanwhile been put on hold amid trade policy shifts and worsening global excess capacity effects. Excess capacity is impairing the ability of companies to conduct the necessary research and development activities, slows their investment in the deployment of lower-carbon technologies at commercial scale, and hinders the development of markets for lower-carbon products, the Committee concludes.
Adam Smith Austria
French longs slip but coil derivatives rise
French long steel prices have declined by around €10/tonne ($11.63/t) on average compared with early October. However, coil derivatives, including tubes and sheets, are rising by €20-30/t, driven by higher coil procurement costs linked to CBAM and the new safeguard proposal, Kallanish hears.
Market sentiment remains clouded by uncertainty. Buyers report that volumes are holding near last year’s levels, but tight margins and weaker consumption are a growing concern. One buyer of both flats and longs expects future consolidation in the market: “We are too many, and there is not enough consumption for everyone,” the source notes, anticipating a reduction in the number of distributors and service centres.
Price increases for coil derivatives are largely considered artificial, not supported by genuine demand, while the cost of CBAM and the new safeguard remain difficult to quantify.
In southern France, the presence of Spanish and Italian producers continues to press long steel prices slightly below northern levels. Rebar values have declined by approximately €10/t since early October, averaging €590-610/t delivered, with sales limited to small volumes.
Sections have also dropped around €10/t, reaching €740-750/t delivered, while merchant bar prices fell €10/t under pressure from Spanish competition and are now at around €210/t base delivered.
Long product prices are not expected to rise in the coming weeks, as downstream margins remain too tight to support increases. Given the sluggish market and strong European producer competition, values should remain at current levels until year-end.
Natalia Capra France
Thyssenkrupp Steel withdraws from WV Stahl
Germany’s largest steelmaker, thyssenkrupp Steel, has withdrawn from the German Steel Association (WV Stahl), which traditionally represents national steelmakers’ interests.
Thyssenkrupp Steel has terminated its membership, effective 31 December, it tells Kallanish.
“Given the current economic challenges, we recognise our responsibility to use our resources as efficiently as possible,” the company says. “This applies to both the time invested by our personnel and the costs of membership. This decision explicitly does not represent a departure from industry-wide dialogue on political issues of common interest and we will continue to support the WV Stahl’s positions on key industrial policy matters.”
“As Germany’s largest steel producer, our company is aware of its special responsibility and will continue to engage in a committed and focused dialogue with policymakers, regulators, and market partners,” it adds.
“We regret this decision, especially given that thyssenkrupp Steel is actively involved in the association’s work during these challenging times,” WV Stahl notes.
This comes amid preparations for Germany’s national steel summit, which Chancellor Friedrich Merz will hold on 6 November in Berlin, to find ways to overcome the industry’s crisis.
Last month, thyssenkrupp Steel temporarily shut down blast furnace No.9 at its Duisburg-Brückhausen site (see Kallanish passim). The company attributed this decision to weak demand for steel in Europe and increasing pressure from imported products, which negatively impacts the competitiveness of local production. The firm has appointed Marie Jaroni its new chief executive, effective 1 November.
The company is in intensive negotiations with Jindal Steel International regarding its steelmaking business. The Indian group is prepared to invest over €2 billion ($2.29 billion) in the development of electric furnaces and the completion of a green steel production project in Duisburg.
Svetoslav Abrossimov Bulgaria
EU awards €2.9 billion to 61 net-zero technology projects under Innovation Fund
The European Commission has announced the allocation of €2.9 billion to 61 innovative net-zero technology projects under the EU’s Innovation Fund.
The grants follow the first call for net-zero technologies (IF24 Call) launched in December 2024, aimed at strengthening Europe’s technological leadership and accelerating the deployment of decarbonisation solutions across industry. The IF24 Call attracted 359 applications requesting a combined €21.7 billion.
Innovation Fund: €40 billion backbone of EU ETS-financed transition
Funded through revenues from the EU Emissions Trading System (EU ETS), the Innovation Fund supports large-scale investments in low-carbon and net-zero technologies that contribute to the EU’s 2050 climate-neutrality goal.
The 61 selected projects cover 19 industrial sectors across 18 EU countries, focusing on decarbonisation in energy-intensive industries, renewable energy and storage, net-zero mobility and buildings, cleantech manufacturing, and industrial carbon management. Collectively, they are expected to avoid 221 million mt of carbon equivalent emissions during their first decade of operation, comparable to the annual emissions of 9.9 million cars.
Project developers will now begin the grant-agreement preparation phase with the European Climate, Infrastructure and Environment Executive Agency (CINEA) to finalize budgets, timelines and deliverables. Final contracts are expected in the first half of 2026.
Thyssenkrupp Steel withdraws from WV Stahl, Thyssenkrupp AG still to decide
In a major shake-up for the German steel sector, Thyssenkrupp Steel, the country’s largest producer, has officially terminated its membership of the German Steel Federation Wirtschaftsvereinigung Stahl (WV Stahl) to be effective from December 31, 2026, according to a media report by German newspaper The Pioneer.
The withdrawal reflects not only financial strain but also a strategic recalibration, as the company seeks to use personnel and financial resources more efficiently during ongoing restructuring.
The sources stated that they do not believe that the company’s withdrawal during talks with Indian investor Jindal is a coincidence. Thyssenkrupp AG is engaged in negotiations with Jindal Steel International, regarding the potential sale of its steelmaking business Thyssenkrupp Steel, as SteelOrbis previously reported.
The move comes at a time when Germany’s steel industry faces mounting economic pressure, with rising energy costs, foreign competition and uncertain government support. The loss of its biggest member marks a severe blow to WV Stahl’s standing as the unified political voice of the industry.
Thyssenkrupp’s decision underscores growing divisions within Germany’s struggling steel industry. Tekin Nasikkol, chairman of the General Works Council at ThyssenKrupp Steel, described the current environment as “catastrophic.”
According to Thyssenkrupp, the decision “does not mean a departure from industry-wide cooperation”, adding that it continues to back WV Stahl’s positions on trade protection, energy pricing and clean-steel development. Additionally, Thyssenkrupp AG – the parent company – is evaluating whether to follow its steel subsidiary and also leave the association.
Celsa restructures financing with €800m from shareholders
Celsa’s board of directors has announced a new restructuring of the Spanish steelmaker’s finances. This includes a €200 million ($231.4m) cash contribution by current shareholders to the company’s capital, as well as €600m in the form of a subordinated loan.
The refinancing will include “appealing to the debt capital markets”, according to Celsa’s statement monitored by Kallanish. “The adjustment marks the end of the financial reorganisation process that began in September 2023, following the change in control of the company.”
Thanks to the implementation of its industrial plan and a more favourable macroeconomic environment forecast for the steel sector in 2026, Celsa expects significant economic growth and a recovery in revenue next year.
The steelmaker has called an extraordinary shareholders’ meeting on 4 December.
Todor Kirkov Bulgaria
Marcegaglia Ravenna fire causes no major production delays
No major production disruption has been reported at Marcegaglia’s plant in Ravenna, Italy, following a fire that occurred last week. The blaze originated in one of the site’s three cold rolling mills, caused no injuries, and was quickly brought under control, a source close to the company confirms to Kallanish.
A plan to restore the plant’s operations was promptly activated and is expected to be completed within a few weeks. Industrial and commercial agreements were also swiftly put in place to minimise the impact on deliveries, including in the short term.
Several fires have been reported at steelmaker facilities across Europe in recent weeks. One of those affected, ArcelorMittal Fos-sur-Mer, is redirecting certain orders to other plants in France to minimise customer impact. It has sourced slab externally to meet year-end delivery commitments following a fire in October that resulted in a complete production stoppage at the Fos-sur-Mer site.
A fire at Thyssenkrupp Steel’s Bruckhausen section in Duisburg at the end of October caused some damage to facilities at the new hot rolling mill No.4. The fire followed an explosion at the furnace, in which no people were hurt, and was brought under control.
An accident meanwhile recently occurred at Acciaierie d’Italia (ADI)’s Taranto plant. The company said it happened during adjustment operations in the central workshop (see Kallanish passim).
Natalia Capra France