EU carbon tax to hit steel firms

INDIAN STEELMAKERS EXPORTING to Europe are preparing for higher costs, lower margins and tougher choices as the European Union's Carbon Border Adjustment Mechanism (CBAM) begins to bite. Industry estimates suggest that once carbon costs are fully reflected, export prices could rise by 15-22%, a shift that directly affects volumes, profitability and long-term market presence.

- URVI MALVANIA

INDIAN STEELMAKERS EXPORTING to Europe are preparing for higher costs, lower margins and tougher choices as the European Union's Carbon Border Adjustment Mechanism (CBAM) begins to bite. Industry estimates suggest that once carbon costs are fully reflected, export prices could rise by 15-22%, a shift that directly affects volumes, profitability and long-term market presence.

Europe is among India's most important overseas steel markets. Italy, Belgium, Spain and Poland together account for roughly 40% of shipments to the region. With margins already thin for most flat steel products, even partial absorption of CBAM-linked costs could weaken export realisations and make Indian steel less competitive against lower-emission suppliers.