Steel prices are to rise ahead of the implementation of Europe’s carbon border adjustment mechanism (CBAM), which will start from January 2026, panellists said at the Kallanish Europe Steel Markets conference in Amsterdam.
Panellists noted that whilst demand is currently a concern, steel prices are likely to be supported going into the third and quarter quarters with orders needing to be placed soon ahead of January delivery, when CBAM would come into force.
Jerome Waterkeyn, chief executive of Steelforce said: “The demand is one thing… We see [with] imports that’ll happen from 1 January 2026, customers start to stress that if they don’t purchase now, they will be late, and they will be charged or we will have to charge them an unknown amount.”
He added they were squeezed by multiple quotas already in place that could be full towards Q4, ahead of other quotas opening. That could mean “they will be penalised with an additional amount. It’s creating uncertainty, but it creates a revival of restocking, at least from the import side.”
“Maybe CBAM might activate the market, because demand is also very much a feeling, it is about the conviction that people have that the market may go up,” the Steelforce ceo added.
This was echoed by Julian Verden, managing director of Europe at Stemcor Group.
“The logic would suggest that people are going to try get something in just before the CBAM prices, which could cost €60/tonne” as of 1 January, he said.
Kamal Arifi, director of commercial transformation at SSAB Europe, noted that the uncertainty and challenges are supportive of prices.
“Even from some of the experts in the market, the uncertainties, the difficulties they’re facing, that obviously will support prices in a way or another,” Arifi commented.
He highlighted analyst reports foreseeing that prices in Q4 will have support from the implementation of CBAM.
Verden added that there is a “multi-priced and multi-opportunity market, all depending on what’s blocked and what isn’t blocked, and the different pricing that’s for America, for Europe, for the UK and the rest of the world.”
“I would think the implementation of CBAM is going to at least push prices up,” said Waterkeyn, who noted that “the green conversion is an enormous supportive aspect to maintain prices at higher levels.”
Waterkeyn added that Europe’s global push for a greener market via CBAM will also mean that prices will be supported in the long term.
However, Verden noted that if CBAM is taken out of the equation, “then it is possible that prices would not particularly increase.”
He added that steel prices could tick down over the next few weeks, but they would have to rise after that. He revealed that customers currently do not want to buy as they don’t see the demand, but “they get to a point in about a month’s time where it’s going to be January delivery then the price is going to be up.”
Verden estimated that, aside from green sources, CBAM could add €50/t to prices.
Arifi referenced reports by analysts who do not see a further downward trend.
“We are reaching a floor with pricing at the moment, and in Q3 and Q4 there could be an upward trend,” he said, agreeing that prices would be supported by CBAM.
Carrie Bone UK
