EU producers are calling for the CBAM to be extended to the processing sectors

European producers are stepping up pressure on EU regulators to expand the CBAM mechanism to cover the processing sectors, including steel and aluminum products. This position is outlined in a joint statement by industry associations led by EUROFER.

The document emphasizes that the current CBAM model covers only basic materials and does not account for a significant portion of the value chain. As a result, imports of finished products not subject to the mechanism create competitive advantages for foreign suppliers and increase pressure on European producers.

According to the associations’ estimates, this creates a risk of carbon leakage shifting to downstream segments and could lead to the deindustrialization of certain sectors. At the same time, it undermines incentives for investment in decarbonization and reduces the effectiveness of the EU’s climate policy.

EUROFER’s position is also supported by leading market players. Steel companies, including ArcelorMittal, thyssenkrupp, and voestalpine, point to the risk of circumventing the CBAM through imports of finished products. In turn, representatives of the steel distribution and processing sectors emphasize the need to extend the mechanism to a broader range of products to protect the domestic market.

Similar signals are coming from the aluminum industry, where companies warn of a potential loss of processing capacity if current rules remain in place.

The statement emphasizes that the expansion of the CBAM must occur quickly and cover key segments of the processing sector to ensure a level playing field across the entire value chain.

Overall, European businesses agree that without further refinement, the mechanism will be unable to fulfill its function and risks exacerbating the industry’s structural problems rather than resolving them.

As a reminder, the CBAM will lead to significant losses for the Ukrainian economy: the decline in GDP resulting solely from the reduction in iron and steel exports (taking supply chains into account) will reach 2.1% by 2030. This forecast stands in sharp contrast to the European Commission’s estimate of -0.01% of GDP.