CBAM for Iron and Steel: Scope, Emissions and Cost Guide

The legal basis of the product scope is Annex I of Regulation (EU) 2023/956: whether a good is covered is determined by the CN (Combined Nomenclature) codes listed in Annex I.

The scope runs from agglomerated iron ores (2601 12 00) and ferro-alloys through pig iron (7201), DRI (7203), crude steel and semi-finished products (7206–7207) and flat and long rolled products (7208–7229) to tubes and structures (7301–7311), fasteners such as screws and bolts (7318) and other articles of iron or steel (7326). The Commission table lists 205 separate CN codes or code groups for iron and steel — by far the widest of the five CBAM goods sectors.

Who holds the legal CBAM obligation?

The obligation to submit the official CBAM declaration and surrender CBAM certificates sits with the EU-side importer — more precisely, the authorised CBAM declarant (Regulation (EU) 2023/956). The non-EU manufacturer does not surrender CBAM certificates.

The non-EU producer is, in practice, the data source of the process: if the declaration is to be based on actual emissions, the installation, production and emissions data come from the producer. The quality of your EU customer’s declaration depends on the quality of your data.

Which emissions count for iron and steel?

For iron and steel goods only direct emissions are currently priced: Article 7(1) of Regulation (EU) 2023/956 provides that for goods listed in Annex II only direct emissions are taken into account, and iron and steel goods are on that list. The Commission’s default-value table reflects this: the indirect column is empty for iron and steel rows — the one exception being agglomerated iron ores (2601 12 00), for which an indirect value is also published. If you produce on the electricity-intensive EAF route, this works in your favour: the emissions of your grid electricity do not enter the CBAM bill today.

This rule does not make electricity and energy data irrelevant: it remains worth keeping records of for installation monitoring, wider carbon management, LCA/EPD work and possible regulatory changes — it simply does not enter today’s CBAM certificate calculation.

Basis: Regulation (EU) 2023/956, Article 7(1) and Annex II.

How do default values work?

Where actual emissions data is not used, the declaration can rely on the default values published by the Commission. The applicable value depends on the CN code, the country of origin and — for many steel goods — the production route. EPDlogy provides a free lookup based on the official EU data.

Sample rows for Türkiye (from the live dataset):

Dataset: IR (EU) 2025/2621 + IR (EU) 2026/1740 · updated: 2026-08-10

Route indicator C = carbon steel, blast furnace/BOF route. Where no Türkiye row exists, the "other countries and territories" value applies. Look up your own code in the lookup tool — values for the scrap/EAF route (E) are markedly lower.

An importer declaring with default values pays a mark-up on top that rises by year: 10% in 2026, 20% in 2027, 30% in 2028 (1% for fertiliser goods). Source: Implementing Regulation (EU) 2025/2621 (corrected by (EU) 2026/1740).

Default value or actual emissions?

Verified actual emissions data can materially change estimated CBAM exposure compared with default values. Actual emissions may be lower or higher than the applicable default value: on scrap-heavy EAF production the actual value usually sits below defaults set with the blast-furnace route in view, while at integrated plants the gap can shrink or reverse.

In addition, an importer declaring with default values pays a mark-up on top that rises by year: 10% in 2026, 20% in 2027, 30% in 2028. A sound decision needs the two scenarios side by side — our cost calculator shows default and actual results for the same product together.

Illustrative cost example: CN 7208, Türkiye, 1,000 tonnes

The example below is drawn from the same official datasets our cost calculator uses and shows the same steps the calculator applies. Year: 2026, declaring with the default value.

Illustrative estimate, not an official CBAM declaration. Values reflect the official dataset and the current quarterly certificate price at the time this page was built. Route: C (carbon steel, blast furnace/BOF).

The full explanation of these steps: How is CBAM cost calculated?

What is the free allocation adjustment (CBAM benchmark)?

EU producers under the EU ETS still receive free allocation for part of their emissions. To keep treatment equal, CBAM deducts a corresponding adjustment from the declared emissions of the imported good: the number of certificates to surrender is reduced by this adjustment, calculated from the product group’s CBAM benchmark. As free allocation under the EU ETS is phased out from 2026 to 2034, the adjustment shrinks — and the CBAM cost of the same emissions rises year by year.

The size of the adjustment is set by three multipliers: the product group’s benchmark (tCO₂e/t), the CBAM factor and the CSCF. The CBAM factor — 97.5% (2026), 95% (2027), 90% (2028) — reflects the share of free allocation not yet phased out, and scales the benchmark. Contrary to a common misreading, it is not “the percentage of CBAM payable”: as the factor falls, the deduction falls, so the amount payable goes up.

For steel, benchmarks differ by production route: carbon steel carries separate values for the BF-BOF, DRI-EAF and scrap-EAF routes, with distinct low-alloy and high-alloy steel categories. Where the route is unknown for a CN code, our calculator applies the conservative (lower) value; selecting your own route can change the result markedly. Benchmark values can also differ by production-year period (2026–27 / 2028–30).

Basis: Implementing Regulation (EU) 2025/2620 (Annex, Equation 6) and Commission Guidance No. 4; CBAM factor: Directive 2003/87/EC, Art. 10a(1a). As the CSCF for 2026–2030 has not yet been published, 1.00 is assumed in calculations.

What data should a non-EU steel producer prepare?

Under the definitive-period rules and the Commission guidance (Nos. 3 and 5d), the main items a producer preparing to support declarations with actual emissions should have ready:

• Installation identification: the installation and its production processes, consistent with the installation details used in CBAM records.
• Product–CN code mapping: a clear list of which product is exported under which CN code.
• Production route: BF-BOF, DRI-EAF or scrap-EAF, including the alloy category.
• Reporting-period production quantities: tonnage split by process (sinter, pig iron, crude steel, rolled product).
• Direct emission sources: coke, natural gas and other fuels — with quantity and net calorific value records; carbon-bearing process inputs such as electrodes, coal/coke injection and limestone/dolomite (a mass-balance approach is common in steel).
• Precursor data: quantities of purchased billet, pig iron, DRI and ferro-alloys plus embedded-emissions data from the supplier; without it, the precursor takes the default value. Scrap carries zero emissions in the calculation.
• Allocation methodology: documentation of how emissions are attributed to processes and products.
• Monitoring and calculation documentation: monitoring methodology, measurement instruments, data flows and calculation files.
• Evidence supporting actual emissions: primary records a verification could examine (invoices, weighbridge data, laboratory analyses).

Verification readiness: calculating, documenting, verifying

Three distinct jobs, each harder than the last: calculating the emissions, documenting the calculation so it can be audited, and — where actual data is used — having the calculation verified where the applicable CBAM rules require it. Most installations can do the first; the difference shows in the second and third.

The main things a verifier may need to examine under the applicable CBAM rules: whether the monitoring methodology follows the rules, the traceability of data flows and measurements, the consistency of the allocation method, and whether declared values are supported by primary records. For the official verification requirements, see the Commission’s verification and accreditation guidance.

Common steel CBAM mistakes

• Using the wrong CN code: scope and default value both follow the CN code; a wrong code means a wrong value.
• Assuming every steel product has the same default value: values differ markedly by CN code, country and route.
• Confusing default values with actual emissions: default values carry a mark-up that rises by year; actual data requires monitoring and verification.
• Treating the CBAM factor as “the percentage directly payable”: the factor scales the free allocation adjustment to be deducted — it is not the payable share itself.
• Ignoring the production route: for the same CN code, scrap-EAF and BF-BOF differ substantially in both the default value and the benchmark.
• Using unsupported actual data: values not backed by monitoring records cannot be defended in a declaration.
• Confusing the manufacturer’s role with the EU declarant’s legal obligation: the importer surrenders the certificates; the producer supplies the data.

Frequently asked

Free CBAM tools for steel manufacturers

All four are free, no registration required: