Chinese industrial exporters could face more than €1.3 billion in annual carbon-border costs when the European Union’s Carbon Border Adjustment Mechanism (CBAM) reaches full implementation, according to new modelling. The projection concerns emissions-intensive goods entering European markets, especially products made using high-carbon production routes; it is not an assessment of charges payable on imports made during 2026.
The modelled exposure depends on the applicable year, product classification and embedded emissions, as well as eligible deductions for carbon prices paid abroad. CBAM costs are phased in alongside changes to free allocation under the EU Emissions Trading System (EU ETS), so the annual estimate should not be treated as a uniform liability for every exporter or product.
For Chinese steel suppliers, the modelling indicates that lower-carbon production could improve relative competitiveness. That outcome would depend on investment in production technology and the ability to provide emissions data meeting European verification requirements. Differences in delivered prices between Chinese suppliers and producers with other emissions and trade-cost conditions could affect European industrial buyers.
Steel trade effects remain uncertain
The modelling does not establish that CBAM has already cut Chinese steel imports into the European Union by any specific amount. Any change in China’s share of EU steel imports would also depend on tariff-rate quotas, anti-dumping duties, demand, freight costs and competing supply.
Publicly available detail is insufficient to derive a reliable country-by-CN8 customs cost table from the aggregate forecast. For exporters in Serbia and Southeast Europe, the findings underscore the need to compare actual emissions and total landed costs, rather than assume a published carbon-price exposure applies uniformly across suppliers.
The estimate signals the potential long-term scale of China’s CBAM exposure, but the underlying study assumptions require further verification before the figure is used in bankable forecasts.