Ukraine’s steel industry is expected to face significant challenges due to the Carbon Border Adjustment Mechanism (CBAM) set to be implemented in Europe from 2026. According to a study by the GMK Center, nearly 93% of Ukrainian exports subject to CBAM regulation are in the metallurgy sector.
The high carbon intensity of Ukrainian steel production, primarily using the open-hearth or oxygen converter methods, makes it less competitive compared to the electric steelmaking process used in the EU. This could lead to a substantial loss in exports of billets and rolled products, with potential losses estimated at $1.44 billion per year by 2030.
The CBAM is also expected to increase administrative costs and create new trade barriers, further impacting the competitiveness of Ukrainian steelmakers.
