Türkiye has kept its position as the European Union’s largest supplier of finished steel in the first half of 2026, even as shipments declined and Asian competition intensified. The shift in trade flows is happening alongside a regulatory environment that is placing more weight on emissions evidence, tariff-quota access and the overall delivered cost to European buyers. In this context, carbon reporting is moving from a documentation exercise toward a factor that can influence commercial outcomes.
EU trade data cited by EUROFER show Türkiye accounted for 15.7% of finished-steel imports in the first six months of 2026. Its deliveries fell 16% year on year, while import volumes from China increased by 40% and those from Indonesia rose 70%. The broader EU steel import market contracted during the same period, which helps explain the direction of Türkiye’s volumes without proving that carbon-related costs alone drove a competitiveness loss across all product categories.
Market dynamics are therefore being read through a CBAM lens: not every change in shipment patterns points to carbon pricing effects, but emissions verification is becoming more central to supplier comparisons. For European customers, the practical question is how reliably suppliers can substantiate emissions claims under the mechanism’s rules. This matters because calculated carbon liabilities can differ depending on whether default values or verified actual data are used.
Geography and production technology still shape competitiveness, but they do not determine CBAM exposure by themselves. Türkiye’s proximity to European markets reduces transport time and supports established customer relationships. Some Turkish producers also operate electric-arc furnaces, which can produce different emissions profiles compared with other route configurations.
Even so, electric-arc-furnace capacity alone cannot be used as a proxy for CBAM liability. Liability calculations depend on the specific steel product, the scrap and other precursor materials used, furnace operations, direct process emissions and the applicable production benchmark. Electricity procurement also influences industrial costs and carbon reporting quality, linking energy sourcing decisions to both competitiveness and compliance readiness.
Reliable emissions information is increasingly treated as an additional purchasing criterion. Where imports are assessed using applicable default emissions values, calculated carbon liabilities may be higher than for products supported by verified actual data. That distinction can affect offers even when production efficiency is comparable, particularly if traceability or documentation completeness falls short.
A Turkish exporter with incomplete traceability could face a less favourable cost position than a competitor elsewhere despite potentially efficient operations at its facility. In commercial negotiations, the comparison is therefore shifting toward documented product-level emissions rather than relying on country of origin alone. This change increases the importance of consistent measurement and reporting across mills and product lines.
Trade policy adds another layer to cost calculations through quota constraints that run alongside CBAM obligations. From July 2026, the EU’s annual duty-free steel import quota was capped at around 18.3 million tonnes, with a 50% out-of-quota duty applying to imports above the relevant allowances. For Turkish exporters, maintaining access depends on whether individual products qualify under applicable country-specific allocation rules and whether sufficient quota capacity remains available.
Quota availability and CBAM exposure also affect different components of import costs that European buyers must weigh together. Customers comparing offers from Turkish mills and competing international suppliers need to consider both the tariff treatment of each shipment and its carbon-related liability. As a result, delivered cost comparisons are becoming more complex at the intersection of trade measures and emissions compliance.
Looking further ahead, proposed changes could extend compliance requirements beyond basic steel into downstream manufacturing supply chains. The European Commission has proposed extending CBAM to selected downstream products from 2028, while the European Parliament backed a broader product list in September 2026. Negotiations are still ongoing on final product scope, implementation timing and detailed rules for accounting for precursor emissions.
If adopted as proposed, this expansion would broaden obligations for Turkish industrial groups that supply both basic steel and finished goods such as metal components, equipment and fabricated products. The shift would increase the need for connected records that cover producing mills, product classification, embedded emissions, downstream processing steps and information held by EU importers. For companies operating across multiple stages of production, record continuity becomes a compliance requirement rather than an administrative preference.
Contracting practices are also expected to reflect tighter verification expectations. European customers are likely to place greater emphasis on data quality and verification during purchasing negotiations, including contractual provisions on allocation of carbon costs and accuracy of emissions declarations. Remedies may be specified where submitted information proves incorrect.
These terms can reshape relationships across steel producers, downstream manufacturers and importers, especially when final CBAM liability depends on installation-specific information or how precursor materials are treated. In practical terms, supply contracts may increasingly require documentation that supports both tariff assessment and carbon calculations under CBAM rules.
Türkiye’s logistical advantages and leading position by finished-steel import volume remain intact for now, but sustaining that role will depend on verified carbon-adjusted delivered costs as well as transport efficiency, product specifications and access to available tariff quotas. With shipments declining amid a contracted market and rising Asian deliveries, European buyers’ emphasis on emissions evidence is likely to intensify. The combined effect of verification requirements, quota constraints and potential downstream CBAM expansion suggests that compliance performance will increasingly influence supplier competitiveness across multiple layers of cost.