Speaking at the Eurometal Steel Day & YISAD Flat Steel Conference, organized in collaboration with SteelOrbis at the Istanbul Marriott Hotel Asia on Tuesday, March 24, Anıl Akalın, environmental markets, country president Turkey & GCC at UK-based consulting company Redshaw Advisors, stated that the EU’s Carbon Border Adjustment Mechanism (CBAM) will significantly increase costs and reshape trade flows for exporters targeting the European market.
Akalın noted that the definitive phase of CBAM began on January 1, 2026, marking the transition toward full financial implementation of the mechanism.
Gradual phase-in until 2034
According to Akalın, CBAM certificates will become available during 2026, while the first certificate surrender deadline is set for September 30, 2027.
The mechanism will be gradually phased in until 2034, when 100 percent of embedded emissions will be covered, in parallel with the full phase-out of free allowances under the EU Emissions Trading System. Non-compliance under CBAM will result in penalties of €100/mt, while failure to obtain declarant status may lead to fines of up to €500/mt.
Scope to expand across sectors
CBAM is expected to expand its scope over time. By 2028, sectors such as white goods, automotive, metals and machinery are expected to be included, with downstream industries such as plastics and chemicals likely to follow in later phases. Akalın emphasized that the mechanism will become increasingly comprehensive, with the full cost burden ultimately borne by producers.
Carbon prices expected to rise in long term
Akalın highlighted that CBAM certificate prices are not directly equal to EU ETS allowance prices but are derived from similar market mechanisms. EU carbon prices have shown significant volatility over the past decade, and current lower levels should not be interpreted as a long-term trend.
Analysts expect carbon prices to increase over time, potentially reaching €200 as the market approaches the 2030s. By 2050, declining supply of emission allowances is expected to support sustained high carbon prices.
Significant cost impact for Turkish exports
According to estimates shared during the presentation, Turkish steel exports to the EU could face additional costs of around 11 percent of product prices by 2026.
For Turkey, total CBAM-related costs are projected to reach €771 million in 2026 and increase to approximately €2.5 billion annually by 2032. This could result in a reduction of EU-bound exports by around two to three percent over the same period. Aluminum and cement exports are expected to face even higher cost impacts.
Verified emissions critical to cost management
Akalın also highlighted the importance of emissions verification in reducing compliance costs. Based on a model calculation for 50,000 mt of flat steel imports, CBAM costs for 2026 are estimated at approximately €5.8 million when default emission values are applied, compared to around €1.4 million under verified emissions.
Even after adjusting for carbon costs already paid at origin, the cost remains significantly higher under default values at approximately €4.8 million, versus about €1.1 million under verified data.
These findings underline the importance of accurate emissions reporting and verification in managing CBAM-related cost exposure for exporters.