EUROFER and VW Stahl call for revisions to CBAM

The European Commission (EC) has published an updated package of proposals on the Cross-Border Carbon Adjustment Mechanism (CBAM), acknowledging significant gaps in its current model. At the same time, the European Steel Association (EUROFER) says that the proposed changes do not provide sufficient protection for the European steel industry from carbon leakage and job losses.

«Recognising the weaknesses of CBAM and proposing remedies is a long-awaited and necessary first step to ensure the effectiveness of the mechanism. However, the solutions proposed so are insufficient, and fail to address key weaknesses,» said EUROFER Director General Axel Eggert.

According to him, if the EU wants to combine climate ambitions with realistic industrial policy, the CBAM must be reliable and fully protected from abuse from day one.

The association emphasizes that the approach to supporting EU exports remains fragmented. The proposed instruments are temporary, limited to a two-year period, and cover less than a quarter of steel exports. In addition, the financing of transitional mechanisms remains uncertain.

“Without a long-term and comprehensive solution, EU steel producers remain at a competitive disadvantage on global markets,” EUROFER stresses.

Separately, it points to the risks of circumventing the mechanism, which could lead to a formal understatement of indicators without a real reduction in emissions. Although the European Commission recognizes this problem, the industry believes that the proposed measures do not contain clear and effective safeguards, but only postpone their development to the stage of further implementation.

The German steel association VW Stahl also shares this critical assessment of the initiative.

«We support CBAM as an indispensable instrument for preventing carbon leakage and supporting decarbonization. However, a crucial prerequisite for its effectiveness is that the existing gaps are consistently closed,» said Kerstin Maria Rippel, CEO of the association.

According to her, the issues of export support, combating circumvention of the rules, and protecting the entire production chain are particularly acute.

“Half-hearted solutions are unacceptable in the current circumstances. Without urgent revisions, we risk a large-scale transfer of production and added value outside the EU,” Rippel concluded, calling on member states and the European Parliament to strengthen the European Commission’s proposals.

As a reminder, the EU will strengthen the CBAM by adding a wide range of industrial goods, mostly those containing steel or aluminum. In total, this concerns 180 new products. The scope will now cover 7,500 additional importers.