Products
Search on site
The global industrial transformation process is advancing rapidly. Today, production is evaluated not only in terms of quality, price, and durability but also by its environmental impact. At this point, the Carbon Border Adjustment Mechanism (CBAM) marks the beginning of a new era, especially for manufacturers operating in energy intensive industries.
Developed by the European Union (EU), this system aims to limit carbon emissions as part of the fight against climate change. Among the sectors most affected by this new regulation is the iron and steel industry. But what exactly does CBAM mean, why is it so important, and how will it affect the Turkish steel industry?
The Carbon Border Adjustment Mechanism is an initiative developed under the EU’s Green Deal. Its main objective is to extend the carbon pricing system already applied within the EU to imported goods coming from outside the Union.
Producers within Europe are required to pay a financial cost for their carbon emissions. However, imported products from non EU countries were not subject to such obligations. This situation undermined the competitiveness of European manufacturers that adopt environmentally friendly production methods.
CBAM addresses this imbalance by ensuring that products with high carbon footprints entering the European market do so under equal conditions.
From now on, companies in exporting countries such as Turkey will be required to measure, report, and, if necessary, pay for the amount of carbon emitted during production.
One of the primary reasons behind the introduction of CBAM is the issue of carbon leakage. As environmental standards within Europe became stricter, some manufacturers started relocating their production facilities to countries without carbon regulations in order to avoid additional costs. This not only weakened environmental goals but also created unfair competition for producers remaining in Europe.
To address this challenge, the EU developed the CBAM framework. Under this system, goods imported from countries without carbon pricing will be subject to a carbon tax upon entry into the EU, based on their emission levels. This ensures that environmental standards are maintained while also preserving fair competition among producers.
In its initial phase, CBAM applies to sectors with the highest levels of carbon emissions. These include:
• Iron and steel
• Aluminum
• Cement
• Fertilizers
• Electricity
• Hydrogen
These sectors are among the largest sources of carbon emissions in European industry. In the future, the system is expected to expand to include other industries such as chemicals, glass, and textiles.
The steel industry accounts for approximately 7–8% of global carbon emissions, highlighting its crucial role in achieving global climate targets. Therefore, CBAM directly affects steel production.
By taking the carbon footprint of steel imports into account, the European Union is effectively signaling that high carbon production methods will no longer offer a competitive advantage. Steel produced using coal based blast furnaces will face additional tax burdens when entering the EU market. In contrast, low carbon steel manufactured through electric arc furnaces (EAFs) using scrap recycling will become more competitive.
Since Turkey is one of the EU’s key steel suppliers, CBAM will have a direct impact on Turkish steel producers. Consequently, this regulation is expected to act as a driving force for technological transformation within Turkey’s steel industry, encouraging the adoption of sustainable and low carbon production methods.
Turkey is one of the largest steel suppliers to the European Union. Therefore, the implementation of the Carbon Border Adjustment Mechanism (CBAM) has a direct impact on Turkish manufacturers.
From now on, a carbon emission report must be prepared for every steel product exported to the EU. This reporting will include details about the energy sources, raw materials, production processes, and furnace types used during manufacturing. If a producer has not taken measures to reduce carbon emissions, the resulting difference will be reflected as an additional cost during exports to Europe.
This situation will encourage producers to invest in greener technologies. Electric arc furnaces (EAFs), renewable energy usage, and hydrogen based production systems will become key components of this transformation.
Hasçelik operates with an approach that prioritizes sustainability alongside quality in its production processes. The new regulation introduced by the Carbon Border Adjustment Mechanism makes environmentally conscious production investments even more critical.
The company’s long term objectives include increasing energy efficiency, reducing its carbon footprint, and raising the proportion of recycled raw materials used in production. This strategic approach not only strengthens Hasçelik’s environmental responsibility but also provides a sustainable competitive advantage in international markets.
The Carbon Border Adjustment Mechanism is being implemented gradually:
• 2023–2025: This period is defined as the transition phase. During this stage, companies are only required to report their carbon emissions. There is no financial obligation yet.
• 2026 and beyond: CBAM will be fully enforced. From this point onward, importers will be financially liable for the carbon emissions associated with their imported goods.
This means that companies must review their production processes and prepare to adopt low carbon methods by 2026. Producers who fail to complete this transition on time risk losing their competitiveness in the European market.
To comply with the Carbon Border Adjustment Mechanism, steel producers must follow a structured roadmap. The key steps include:
1. Accurate carbon footprint calculation: Measure in detail the emissions resulting from energy sources, fuel types, and production processes.
2. Establishment of a reporting system: Develop transparent data collection and reporting infrastructure.
3. Energy efficiency projects: Implement modern systems that reduce energy consumption on production lines.
4. Use of renewable energy: Energy sourced from solar or wind power directly reduces carbon emissions.
5. Sustainability in the supply chain: Include raw material suppliers in carbon reduction targets.
For many years, Hasçelik has focused on enhancing its quality standards alongside environmental awareness. The company is shaping the future of steel production today through its emphasis on energy efficiency, recycling, low emission manufacturing, and eco friendly processes.
Regulations such as the Carbon Border Adjustment Mechanism align closely with Hasçelik’s existing vision. Sustainability is no longer just an ideal but a core criterion shaping the future of the steel industry.
The Carbon Border Adjustment Mechanism demonstrates that environmental responsibility has become an economic value in global trade. The steel industry stands at the heart of this transformation. In this new era, companies that reduce carbon emissions, invest in green production technologies, and ensure data transparency will stand out.
For innovative producers like Hasçelik, CBAM not only strengthens environmentally friendly production but also enhances sustainable competitiveness in international markets.
