European steel buyers are increasingly assessing imported material using a carbon-adjusted landed-cost approach. Traditional comparisons based on mill price, freight, customs duties and financing are described as insufficient when steel from different manufacturing routes can have substantially different embedded emissions.
Under the EU Carbon Border Adjustment Mechanism (CBAM), the emissions profile of a shipment can affect its final cost. The commercial benchmark is shifting toward the delivered price after accounting for carbon exposure, rather than the lowest quotation at the port.
Manufacturing routes and carbon cost differences
Steel produced through the blast-furnace route can carry a higher emissions burden than material made through lower-carbon processes. The magnitude of the difference depends on installation-level performance, electricity sourcing, scrap content, upstream inputs and the production technology used.
These route-based differences can lead to variations in potential CBAM liabilities. As the mechanism’s financial impact increases over time, emissions intensity of imported steel becomes a more significant factor in procurement decisions.
The effect is illustrated using a Q3 2026 CBAM price of €82.32 per tonne of CO2. A difference of 0.5 tonnes of CO2 per tonne of steel corresponds to approximately €41.16 per tonne of steel, before other applicable adjustments.
A carbon-cost gap of this size can remove an advantage linked to freight or an initial supplier offer price. In that case, a shipment priced lower at the outset may become more expensive once emissions-related costs are included.
Emissions documentation in supplier pricing
The availability and quality of emissions information are becoming important commercial inputs in European steel procurement. A producer able to substantiate an actual emissions value below a conservative default assumption may be able to offer a more competitive carbon-adjusted price.
Suppliers that cannot provide acceptable installation and product-level data may leave importers facing uncertainty about the applicable emissions calculation and potential certificate costs. This uncertainty can affect how buyers assess total delivered cost under CBAM.
The documentation requirement creates incentives for buyers to request emissions data before finalising supply agreements. Carbon information is increasingly relevant to supplier selection, price negotiations and the allocation of compliance responsibilities.
For exporters, verified emissions data can function as a commercial asset. It can help distinguish lower-carbon production from higher-emissions alternatives and support a more favourable landed-cost calculation for the European customer.
Duty-paid quotations and carbon components
The same developments are affecting how European steel prices are assessed and quoted. Duty-paid import quotations increasingly need to differentiate between offers that include CBAM-related costs and those that exclude them.
This trend points toward a landed-price framework where the carbon component is explicitly identified. Rather than being absorbed within a trader’s margin or left outside the initial price comparison, it becomes part of how offers are evaluated.
For buyers, procurement tenders are expected to request emissions information alongside conventional specifications such as chemical composition, dimensions, delivery schedules and price. For sellers, emissions data is described as becoming part of the commercial offer rather than treated as separate sustainability disclosure.
The resulting market structure could widen price differences between steel with higher and lower embedded emissions. Carbon-intensive material may remain commercially viable in Europe, but the discount needed to compete will increasingly depend on the emissions-related cost calculated under CBAM and the corresponding EU ETS price reference.