The steel market in the second half of 2026
Since 1 July 2026 a new EU protective mechanism for steel has been in force, introduced by Regulation 2026/1384. The out-of-quota duty is 50%, the annual duty-free quota is 18,345,922 tonnes, 47% less than the 2024 import volume, and the number of product categories has risen to thirty. In September 2026 hot-rolled sheet prices in Southern Europe reached EUR 790 per tonne after a EUR 20 increase, and cold-rolled sheet EUR 920. At the same time the Polish PUDS index showed slight declines in distribution prices of hot-rolled sheet, to a range of PLN 3,310-3,442 per tonne.
These two movements in opposite directions describe well the conditions in which purchases are planned today. The primary market is under pressure from costs and limited import supply, while the distribution market is under pressure from weak industrial demand.
What the new protective mechanism has changed
The previous safeguard expired on 30 June 2026. It was replaced by a mechanism with an entirely different scale of impact.
| Element | Status after 1 July 2026 |
|---|---|
| Out-of-quota duty | 50% |
| Annual duty-free quota | 18,345,922 tonnes |
| Scale of reduction | 47% below the 2024 import volume |
| Number of product categories | 30, after adding categories 1B and 25B |
| Quota management | quarterly, with country quotas for countries with a historical share of 5% or more |
| Origin | melt and pour rule, i.e. the place where the steel was first melted and cast, confirmed by the mill certificate |
For a steel sheet buyer in Poland two consequences matter most. The first is the changed economics of imports from outside the EU: with a 50% duty, material brought in after the quota is exhausted is no longer a price alternative. The second is the quarterly rhythm of quotas, which means that the availability of imported material changes within the year and depends on how quickly the pool is used up in a given quarter.
The melt and pour rule shifts the burden of proof onto origin documentation. The country of origin of steel is the place where it was first melted and cast into solid form, confirmed by the mill certificate. The European Commission is specifying the detailed evidence requirements, and implementation is spread over 2026 and 2027. In practice this means that complete documentation becomes increasingly important for every delivery of material originating outside the EU.
The mechanism has no fixed expiry date. Reviews are foreseen, the first with a deadline of 30 June 2027, followed by further reviews in 2028 and 2029.
CBAM in the definitive phase
Since 1 January 2026 the Carbon Border Adjustment Mechanism has been operating in its definitive phase. Importers exceeding the threshold of 50 tonnes of goods covered by the mechanism in a calendar year must obtain the status of authorised declarant, purchase and surrender certificates corresponding to the emissions embedded in imported goods, and submit an annual declaration. A carbon price already paid in the country of production can be deducted after verification by an accredited verifier.
A separate issue, relevant for manufacturers of processed products, is the proposal to extend the mechanism to around 180 additional products, including downstream iron and steel products, fasteners and machine parts, with a proposed entry into force on 1 January 2028. In September 2026 it remains a legislative proposal in the ordinary legislative procedure, so its scope and timing may still change. For medium-term planning, however, it is a factor worth keeping in view.
Prices and their direction
At the beginning of September 2026 ArcelorMittal raised prices of flat products by EUR 20 per tonne, citing higher raw material costs, including coal, gas and electricity, higher emission allowance costs and the tighter quota regime, which limits duty-free imports of hot-rolled, cold-rolled and coated sheet to 9.6 million tonnes a year.
| Product | Southern Europe | Northern Europe |
|---|---|---|
| Hot-rolled sheet | EUR 790/t | EUR 770/t |
| Cold-rolled sheet | EUR 920/t | EUR 890/t |
The quotations date from the first days of September 2026. At the same time the Polish PUDS distribution price index for week 36 showed a range of PLN 3,310-3,442 per tonne for hot-rolled sheet, with a weekly change of minus 0.60 to minus 1.94%.
A gap between the mill market and the distribution market is nothing unusual and usually closes with a delay of a few weeks to a few months. For the buyer, however, it carries specific information: the window in which distribution prices do not yet reflect mill increases has limited durability.
On the input cost side the situation in September 2026 was relatively stable. Iron ore quotations held at around USD 100 per tonne despite weakness in futures, and scrap prices in Western Europe levelled off after earlier declines. Energy remains the main cost factor.
Demand, production and capacity utilisation
Production data for 2026 show a slow stabilisation. Crude steel production in the European Union in July 2026 amounted to 10.5 million tonnes, 3.8% more than a year earlier, and cumulatively from January to July to 76.0 million tonnes, 0.4% more. The reference point is 2025, when EU production amounted to 126.2 million tonnes, 2.6% less than in 2024 and the lowest level on record. Production in Poland in 2025 amounted to 7.2 million tonnes, 0.8% more year on year.
The Eurofer forecast of June 2026 assumes growth in apparent steel consumption in the EU of 0.4% in 2026 and 2.2% in 2027. Capacity utilisation in the first quarter of 2026 was 65.4%. Import penetration reached a record 37% of apparent consumption in the fourth quarter of 2025, against 30% for 2025 as a whole.
In Poland industrial sentiment remains weak. The manufacturing PMI stood at 48.3 points in August 2026, compared with 49.0 in July, the sixteenth consecutive reading below the 50-point mark. The report pointed to a faster decline in output and new orders than in July and to lengthening delivery times.
Taken together, these data show a market in which demand does not create pressure for higher prices, but supply, costs and regulation already do.
Risk factors for the coming quarters
The structural factor most often cited by the industry remains global excess capacity. The OECD estimates it at 640 million tonnes in 2025, forecasting an increase to 745 million tonnes by 2028. The organisation also points to a growing number of cases of anti-dumping circumvention and to export restrictions on steelmaking raw materials, including scrap.
The second factor is regulatory uncertainty: the specification of origin evidence requirements and the fate of the proposal to extend CBAM to processed products. The third remains the cost of energy, identified by Eurofer as a factor limiting the recovery of production in the EU.
None of them points to abrupt movements, but all support the same operational conclusion: the value of a predictable delivery is increasing.
Possible conclusions for purchase planning
The order horizon is lengthening naturally. Quarterly quota management means that the availability of imported material changes within the year. Purchases planned a full quarter ahead give greater certainty of continuity than replenishing stock from week to week.
Origin documentation is gaining in importance. With the melt and pour rule and evidence requirements being specified, the mill certificate is no longer a formality but becomes part of the risk calculation. The matter is best agreed with the supplier before ordering, not after delivery.
The price per tonne is no longer a sufficient criterion. With stable input costs and rising energy and regulatory costs, the outcome is increasingly determined by the total cost of sourcing material: lead time, transport cost, yield per tonne at a given tolerance and grade, and the cost of downtime if a delivery fails.
Alternative sources of material are gaining value. With limited import supply and high mill prices, material from production surpluses and batches downgraded for visual reasons becomes a real option for applications in which surface appearance is not critical. The price difference can be significant, while mechanical properties and dimensions remain in line with the standard.
Flexibility in the specification has measurable value. Accepting an alternative coating weight, a similar grade with equivalent parameters or a different delivery form can shorten lead times by weeks. The precondition is to establish in advance what in a given product is a hard requirement and what is habit.
HEN-STOL works with material from current mill production as well as from surpluses and downgraded batches, which makes it possible to match the solution to the market situation and to the specific application. Available steel grades, coating types and formats of coils, slit strip and sheets are presented in the HEN-STOL steel sheet offer, with separate pages for galvanized steel sheet, cold-rolled steel sheet and hot-rolled steel sheet.
See how we can help
When planning purchases for the coming quarters, it is enough to send the specification with the expected demand. We will check availability and assess which material option is the most cost-effective at the time.
Frequently asked questions
What is the out-of-quota duty on steel in 2026?
Since 1 July 2026 the out-of-quota duty has been 50%. The annual duty-free quota has been set at 18,345,922 tonnes, 47% less than the 2024 import volume.
What does the melt and pour rule mean?
The country of origin of steel is the place where it was first melted and cast into solid form, not the place of its last processing. Origin is confirmed by the mill certificate, and the detailed evidence requirements are being specified by the European Commission.
Does CBAM already cover processed products?
In September 2026 the mechanism covers, among other things, iron and steel within the scope defined in the regulation. The extension to around 180 processed products from 1 January 2028 remains a legislative proposal.
What were steel sheet prices in Europe in September 2026?
Hot-rolled sheet cost EUR 790 per tonne in Southern Europe and EUR 770 in Northern Europe, cold-rolled sheet EUR 920 and EUR 890 per tonne respectively, after a EUR 20 increase introduced at the beginning of the month.
Is steel demand in Europe growing?
The Eurofer forecast assumes growth in apparent consumption of 0.4% in 2026 and 2.2% in 2027. At the same time capacity utilisation in the first quarter of 2026 was 65.4%, and the Polish PMI remains below 50 points.
Is it worth increasing material stock in this situation?
The decision depends on the cost of capital and the regularity of consumption at a given plant. The quarterly rhythm of quotas and rising mill prices favour planning a full quarter ahead rather than building stock not backed by orders.
Sources
- Regulation (EU) 2026/1384 of the European Parliament and of the Council on protective measures concerning imports of steel products
- European Commission, Access2Markets, New EU safeguards on steel imports from third countries
- European Commission, Carbon Border Adjustment Mechanism, definitive period
- Eurofer, Economic and Steel Market Outlook 2026-2027, June 2026
- worldsteel, crude steel production data, January and August 2026
- Kallanish, European flat product prices, September 2026
- OECD, Steel Outlook 2026
- S&P Global, Poland Manufacturing PMI, August 2026