The association warns against circumventing the mechanism: many imported steel products are not covered
European steel industry leaders have urged Members of the European Parliament to close remaining loopholes in the Carbon Border Adjustment Mechanism (CBAM) and ensure a level playing field for European steel producers investing billions of euros in low-carbon production, ahead of the European Parliament's vote on the mechanism.
A report published by the European Steel Association, Eurofer, indicated that the EU's CBAM, which entered its final phase in January of this year, was established to ensure that imported steel faces carbon costs equivalent to those paid by European producers.
The report pointed out that a major loophole still exists, explaining that many imported products made from steel are still not covered by the mechanism. This means that foreign producers can circumvent CBAM carbon costs by converting steel into finished products before exporting them to Europe, leading to the relocation of production and emissions outside the EU instead of reducing them.
Eurofer indicated that it supports an amendment proposed by the European Parliament's Industry Committee to extend the scope of the mechanism to include additional products described as steel-intensive.
In this context, the Director General of the European Steel Association, Eurofer, Axel Egerth, said that steel producers in Europe are investing billions of euros to produce cleaner steel, but they cannot complete this transition without a genuine level playing field.
He added that Members of the European Parliament have the opportunity to strengthen the CBAM so that investment in low-carbon steel production in Europe becomes economically viable. Europe should create the right conditions for producing more clean steel locally, not create incentives that drive production elsewhere.
Eurofer emphasized that addressing this issue is crucial as the European steel industry invests billions of euros to fundamentally transform steel manufacturing methods and significantly reduce carbon emissions, at a time when it faces rising carbon costs.
It added: If the CBAM can be circumvented by importing steel embedded in finished or higher-processed products, this will lead to a weakening of demand for European steel and undermine its economic viability and these investments.
Eurofer also stressed that extending the scope of the CBAM would include more steel-intensive products and ensure that steel produced in Europe and steel embedded in imported products compete under equivalent carbon conditions. It warned that strengthening the effectiveness of the CBAM could contribute to transforming Europe's climate ambitions into industrial investments that support the production of larger quantities of low-carbon steel in Europe, instead of relocating production and emissions to other regions.
• Eurofer is the main representative and voice of the steel industry in the European Union. It includes steel-producing companies and national federations across the continent, and it advocates for the sector's interests before European institutions, supports fair trade policies, and promotes the transition towards low-carbon production and the use of steel scrap.
• The Carbon Border Adjustment Mechanism (CBAM) is a regulatory tool imposed by the European Union to impose carbon levies on imports of emission-intensive goods such as steel, in order to prevent carbon leakage and protect local producers committed to strict environmental standards.
