Steelmakers rejig production system as CBAM kicks in

Companies secure emission verification, shift to low-carbon routes even as lawyers flag risks for small exporters

- SAKET KUMAR

Indian steel exporters supplying to the European Union (EU) are reworking production processes, certification systems, and supply chains to deal with the EU’s Carbon Border Adjustment Mechanism (CBAM), even as lawyers warn that legal, compliance, and commercial risks could intensify sharply now that the levy has entered its payment phase from January 1, 2026.

A senior executive at a top Indian steelmaker told Business Standard that the company has secured EU-recognised plant-level emissions verification and begun exporting lower-emission steel to Europe, aligning shipments in advance with CBAM requirements. “Our company has tied up with an international certification body to issue environmental product declarations (EPDs), documents that disclose the embedded carbon, or total greenhouse gas emissions generated during steel production,” said the executive, who did not wish to be identified. “EU customers had started pushing much earlier. We did not want to wait till 2026.”