CBAM and EU steel trade protection - impact on sheet processors
Since 1 July 2026 steel imported outside the tariff quota has been subject to a duty of 50 percent of the customs value, and the definitive phase of CBAM has applied since 1 January 2026. Both mechanisms cover raw material and semi-finished products, but not processed finished goods. For a sheet processing plant inside the European Union this means a higher material cost without an equivalent burden on a supplier importing a finished component. This situation will remain in place at least until 2028.
Regulatory status in 2026
The changes introduced in the first half of 2026 are usually presented as reinforced protection of the European steel industry. From the perspective of a sheet processor the picture is more complex, because three mechanisms operating in parallel change both the cost of material and the documentation required at customs clearance.
| Mechanism | In force from | Scope | Consequence for the processor |
|---|---|---|---|
| Safeguard measure, duties and quotas1 | 1 July 2026 | 26 categories of steel products, duty-free quota of about 18.3 million tonnes per year, managed quarterly | Duty of 50 percent of the customs value once the quota is used up, previously 25 percent |
| CBAM definitive phase2 | 1 January 2026 | Raw materials and semi-finished products, including flat steel products; de minimis threshold of 50 tonnes net mass per year | Authorised declarant status, purchase of certificates and verification of embedded emissions on the importer side |
| Melt and pour rule1 | 1 October 2026 | Origin determined by the country where the steel was melted and first cast | The mill certificate becomes proof of origin at customs clearance |
| Extension of CBAM to processed goods6 | proposal, from 1 January 2028 | About 180 processed products with high metal content | Until it enters into force, the asymmetry between raw material and component remains |
Status as of August 2026. The dates relating to the extension of CBAM are subject to the legislative procedure.
50%
duty on the customs value of steel imported outside the quota, from 1 July 20261
18.3 m t
annual duty-free quota, an average reduction of volumes by 47 percent1
50 t
CBAM de minimis threshold, net mass of imports in a calendar year2
EUR 5.4 bn
estimated annual cost of out-of-quota duties for steel users, against about EUR 0.7 billion in 20244
Asymmetry between raw material and finished goods
The core problem is that these mechanisms cover input material but not processed products. As a result, a plant operating inside the European Union bears the cost of duties and CBAM embedded in the price of the sheet it buys, while a supplier of a finished component made from the same sheet outside the Union bears neither.
1
Processor inside the Union
Buys material whose price includes the out-of-quota duty and the cost of CBAM certificates, and in the case of EU steel also the cost of emission allowances.
2
Component supplier outside the Union
Places a processed product on the market that is covered neither by steel quotas and duties nor by the CBAM certificate obligation.
3
Effect
The cost gap grows with the share of material in the cost of the product, and is largest in simple, material-intensive manufacturing.
The scale of the phenomenon in data
A study carried out for the European technology industry federation found that out of fifteen products analysed, eleven are at risk of production being relocated outside the Union by 2034, eight of them as early as 2026, with manufacturing costs rising by close to 50 percent in extreme cases3. The same organisation estimates the cost of out-of-quota duties for steel users at EUR 5.4 billion per year, against about EUR 0.7 billion in 20244.
11 of 15
analysed products at risk of production moving outside the Union by 20343
+213%
growth of steel derivative imports into the Union in 2010-2024, now over 8 million tonnes per year5
+217%
growth of imports in the prefabricated structures category, and 211 percent in iron and steel articles5
Import data confirm the direction of change. The growth concerns above all products made from sheet that has been cut, bent, welded or pressed, that is operations also carried out by plants in Poland. For this reason the steel distribution and processing community calls for an assessment of the cumulative impact of quotas, duties and CBAM on the entire value chain, not only on steelmaking6.
Planned extension of CBAM from 2028
In December 2025 the European Commission proposed covering about 180 processed products with high metal content, with application planned from 1 January 2028. The Council adopted its position in June 2026 and the negotiating mandate of the European Parliament is expected in September 20266.
The effectiveness of this solution is disputed. The European steel producers association points out that the scope remains insufficient and that the mechanism resolves neither the redirection of low-emission flows into the Union nor the situation of exporters6. Regardless of that assessment, the timetable means that the asymmetry described above will persist at least until 2028.
Price situation
In 2026 regulation became a significant price-setting factor. Market participants indicate that import offers on DDP terms including the cost of CBAM are close to domestic price levels in the Union, which means the traditional price advantage of imports has disappeared7. This changes the logic of purchasing: the decisive criteria become format availability and delivery time rather than the origin of the material itself.
| Product | Wholesale price level, net | Quotation period |
|---|---|---|
| Hot rolled sheet | PLN 3,270-3,480 per tonne | June 2026 |
| Cold rolled sheet DC01 | PLN 3,794-4,024 per tonne | April 2026 |
Polish market, PUDS steel price index8. Wholesale levels excluding tax, delivery and processing costs.
Conclusions for purchasing policy
In the horizon up to 2028 the cost of material remains the variable that a processor can influence more than the regulatory environment. Four areas offer the greatest potential: verification of the documentation actually required for individual product groups, adjustment of specifications regarding formability class and coating weight, optimisation of the delivery form and lot size, and purchase planning that takes account of the quarterly management of quotas.
A separate risk, relevant for the whole chain, is the shift of some buyers from purchasing material to purchasing finished components. It affects processing plants and their steel suppliers to the same degree, and its scale depends on how long the difference in treatment of raw material and processed goods persists.
Available steel grades, coating types and coil, strip and sheet formats are presented in the HEN-STOL steel sheet offer. The origin of material coming from mill surplus production is discussed in the article on excess prime steel.
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Send us the specification of the material currently in use - grade, thickness, width, class and type of coating, preferred delivery form and lot size. We will check availability and present the best terms we can offer.
Frequently asked questions
Does CBAM cover finished steel products?
No. In the definitive phase in force since 1 January 2026 the mechanism covers raw materials and semi-finished products, including flat steel products. Processed finished goods remain outside its scope. The European Commission has proposed covering about 180 processed products from 1 January 2028; the proposal is going through the legislative procedure.
How high is the duty on out-of-quota steel in 2026?
Since 1 July 2026 the out-of-quota duty is 50 percent of the customs value, up from 25 percent. The measure covers 26 categories of steel products and the annual duty-free quota has been set at about 18.3 million tonnes, an average reduction of volumes by 47 percent. Quotas are managed on a quarterly basis.
Who carries the CBAM obligations?
The obligations rest with the importer bringing goods into the customs territory of the Union: authorised declarant status is required, together with the purchase of certificates corresponding to embedded emissions and verification of the data. The de minimis threshold is 50 tonnes net mass per year. A plant buying sheet from a domestic supplier is not the declarant, but the cost of the mechanism is included in the price of the material.
What is the melt and pour rule?
From 1 October 2026 the country of origin of steel is the country where it was melted and first cast, not the country of the last substantial processing. Mill certificates serve as proof at customs clearance. The rule limits the possibility of circumventing duties by re-rolling or coating material in a third country.
Why are imported finished components in a better position than production inside the Union?
Duties and CBAM apply to input material, not to the processed product. A plant in the Union buys sheet at a price that includes these charges, while a component made from the same sheet outside the Union enters without them. A study carried out for the European technology industry federation indicates that eleven out of fifteen analysed products are at risk of production being relocated outside the Union by 2034.
What documents are needed when buying steel sheet in 2026?
The scope depends on the application of the end product and on the direction of supply. For imports, mill certificates confirming the country of melting and data on embedded emissions are relevant. For domestic purchases the requirement follows from the product standard or the contract, most often an inspection document according to EN 10204. Verifying the actual requirement before placing an order limits the cost of documentation that is not needed.
Sources
- European Commission, new safeguard measure for steel imports, June 2026
- European Commission, Access2Markets, CBAM definitive period, 2026
- Orgalim, EU Carbon Border Adjustment Mechanism, study by ERM
- Orgalim, New EU steel safeguards. A devastating threat for European steel users, November 2025
- EUROMETAL, Steel derivatives. The hidden threat driving Europe's deindustrialisation, October 2025
- Eurofer, position on the proposed extension of CBAM, June 2026
- S&P Global, Europe's steel industry faces its 2026 reckoning with CBAM, January 2026
- PUDS, steel price index, 2026 quotations