Uncertainties concerning the EU’s Carbon Border Adjustment Mechanism (CBAM) and the implementation of new safeguarding measures were limiting buying appetite for new steel imports into the EU, trade sources told Fastmarkets on Thursday September 4.
CBAM
The scheduled implantation of CBAM in January 2026 was currently the major talking point for the European steel market, Fastmarkets heard, due to continued lack of clarity on its implementation, just a few months ahead of the official starting date.
On August 28, the European Commission launched three public consultations on the practical implementation of CBAM.
These linked consultations were intended to finalize the rulebook for CBAM’s full launch – specifically defining how emissions will be measured, how EU free allowances will be adjusted, and how existing carbon prices paid elsewhere will be recognized – to ensure that the mechanism is fair, effective and ready by January 2026.
CBAM consultations goals
1. Define the methodology for the definitive CBAM period (starting January 1, 2026)
Main goal
To establish and refine the methodology for calculating the carbon emissions, both direct and indirect, embedded in imported goods under the CBAM once it transitions to its full (definitive) phase in 2026.
This includes clarifying the use of actual emissions data versus default values, simplifying and standardizing calculation procedures, and ensuring consistency with EU ETS-based reporting, thereby reducing administrative burdens and promoting environmental integrity.
2. Adjustment of CBAM certificates for free ETS allowances
Main goal
To set out detailed rules for adjusting the obligation of CBAM declarants (importers) to surrender CBAM certificates, to account for free allowances they would otherwise receive under the EU Emissions Trading System (ETS).
This ensures that EU- and non EU produced goods will face equivalent carbon pricing, maintaining a level playing field when those free allowances are phased out from 2026 to 2034.
3. Carbon price paid in a third country
Main goal
To define the rules and procedures for allowing importers to reduce their CBAM certificate obligations by accounting for carbon pricing already paid in a third (non EU) country.
This includes specifying how to convert such payments to euros, what evidence must be provided and who can certify it, ensuring fairness and avoiding double penalties for non-EU producers which already face carbon costs.
The Commission will accept feedback until September 25, 2025, with a final draft on CBAM implementation expected to be published during the fourth quarter of the year.
Market reaction
Several sources told Fastmarkets that some Asian suppliers – notably from Vietnam, Taiwan and China – have been offering cold-rolled and hot-dipped galvanized coil with remarks that they were ready “to take the risk of CBAM costs,” meaning that supplier would bear any additional costs.
But it was still unclear what CBAM costs will be for new imports starting in January 2026.
“[CBAM costs] will depend on [emissions] benchmarks that the European Commission will set for each product, and on carbon emissions costs. All of that is not clear yet, and the final draft is supposed to be published after consultations on CBAM are closed [this month],” a buyer in southern Europe said.
Offers of CRC to Southern Europe from Vietnam were reported at €610 ($710) per tonne CFR and at €650 per tonne CFR from Taiwan.
In August, several market sources reported a booking of China-origin CRC to Antwerp at €640 per tonne CFR, with the price reported to include both anti-dumping duties and CBAM-related costs.
Fastmarkets’ weekly price assessment for steel cold-rolled coil, import, cfr main port Southern Europe, was €610-650 per tonne on September 3, up from €600-610 per tonne seven days earlier.
Vietnamese suppliers of 0.58mm HDG with Z140 coating were said to be hoping to achieve €810 per tonne CFR to Southern Europe, Fastmarkets heard. Bids for such material were heard lower by €30-40 per tonne at €770-780 per tonne CFR.
Steel safeguard measures
Another major steel imports regulation tool, steel safeguards measures that have been in place since 2019, were also expected to change in 2026.
The European Commission held public feedback consultations on future steel trade measures to replace the existing steel safeguard measures in July-August, with adoption planned for the third quarter of 2025.
The consultation attracted 143 submissions, with the great majority from European companies and associations supporting long-term measures based on tariff-rate quotas (TRQs), with no exceptions and covering all basic steel products, including steel derivatives and processed products, Fastmarkets understands.
Trade sources that spoke to Fastmarkets believed that the new measures would most likely come into force sooner than July 2026, with one mill source saying: “The idea is for the new measures to be implemented as of January 2026.”
Meanwhile, the existing steel safeguarding measures cover 26 product categories.
Fastmarkets analyzed hot-rolled coil (HRC), cold-rolled coil (CRC) and hot-dipped galvanized coil (HDG) steel safeguards quota usage by country from July to September 2025.
Regarding HRC, suppliers such as Turkey, South Korea and Taiwan managed to fully exhaust their allocated quotas for July-September. India, Egypt and Vietnam used less than one-third of their quotas during the same period.
In addition to the safeguard quotas, Egypt Vietnam and Japan have also had provisional anti-dumping duties for HRC imposed in the EU since April, with definitive duties expected to come into force in October.
For CRC, most countries under steel safeguards quotas managed to use between 91% and 100% of their allowance during the third quarter of the year, with only Turkey fully exhausting its allowance.
From Turkey, CRC offers were reported at €600-620 per tonne CFR on September 4. But despite having an advantage of quicker delivery to the EU, Turkey remained a risky option due to its limited quota allocation of only 43,989 tonnes per quarter.
“There are too many CRC suppliers in Turkey and too little tonnage available, so the quota is always exceeded,” a second European buyer said.
Similarly, most countries took advantage of their steel safeguard allowance for HDG – both categories 4a and 4b. Suppliers such as China and Taiwan used 100% of their quotas, closely followed by Turkey, Vietnam and South Korea, which used more than 90% of their available balances.
Julia Bolotova, Davide Montagner
