EU Carbon Border Adjustment Mechanism (CBAM) officially takes effect
The EU Carbon Border Adjustment Mechanism (CBAM) entered its transition phase in 2023 10, with full carbon tariffs taking effect starting in 2026. Exporters to the EU must prepare in advance.
The Carbon Border Adjustment Mechanism (CBAM) entered its transitional phase in 2023 10 and will begin full implementation of carbon tariffs starting in 2026. This policy is expected to have a profound impact on global trade patterns; companies exporting to the EU must prepare in advance.
Key Policy Points
1. Coverage: Six major industries including steel, aluminum, cement, fertilizers, power, and hydrogen, with potential expansion into additional sectors in the future.
2. Transition Period (2023-2025): Importers only need to report product carbon emissions; no carbon tariff applies.
3. Effective Date (2026): Importers must purchase CBAM certificates, priced in line with the EU Emissions Trading System (EU ETS).
4. Carbon Price Level: The current EU ETS carbon price is approximately 80-100 EUR/ton, and it is expected to continue rising.
Impact on Chinese Enterprises
China is a major source of steel and aluminum imports for the EU. Estimates indicate that after CBAM implementation, costs for affected exporters will rise by 5-15%. Companies should promptly begin carbon footprint accounting, optimize production processes, and reduce carbon emissions.
Recommended Actions
1. Conduct carbon accounting: Perform product carbon footprint assessments promptly to understand your organization's emission levels.
2. Optimize production processes: adopt low-carbon technologies to reduce carbon emissions per unit of product.
3. Obtain certification: Apply for relevant environmental certifications to enhance product competitiveness.
4. Choose green logistics: Opt for low-carbon transport options to reduce your overall carbon footprint.
Shenghe International Logistics recommends that customers closely monitor CBAM policy developments and prepare in advance. We will continue to track policy changes and provide compliance guidance to our clients.
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