Steel at a Turning Point in 2026

With the carbon obligations of the CBAM starting in 2026 and the EU's tightening of quotas and taxes, Turkish steel is reaching a strategic threshold; an additional cost of approximately 60 euros per ton and the halving of quotas in the package anticipated after June 2026 pose a risk of up to a 60% decrease in exports to the EU. The sector calls for urgent negotiations with the EU, effective trade defense, and investments that reduce carbon costs.

The Turkish iron and steel industry is approaching a challenging threshold due to the Border Carbon Adjustment Mechanism (CBAM) that will come into effect in 2026 and the European Union's steps to tighten quotas and increase taxes. Two leading figures in the sector, Tosyalı Holding Chairman and ADMIB President Fuat Tosyalı and World Steel Association President for the 2025–2026 term, Çolakoğlu Metallurgy General Manager and CIB Vice President Uğur Dalbeler, emphasized that negotiations should be conducted promptly and in a coordinated manner.

CBAM and EU restrictions at the center of the agenda

Fuat Tosyalı reminded that CBAM will impose financial obligations in 2026 and that approximately 60 euros per ton of carbon cost will be added to exports. Tosyalı stated that the EU is establishing new barriers to market entry by reducing quotas and increasing taxes, saying, "We need to negotiate this issue with the EU under the leadership of relevant ministries and sector organizations as a country. Every step to be taken in a strategic sector like steel will affect all other sectors and the national economy."

Global outlook and warnings from Dalbeler

Uğur Dalbeler, who took over the presidency of the World Steel Association, stated that the carbon tax to be applied to imports is of critical importance, that the EU has provided billions of euros in support to the steel sector within the scope of decarbonization targets, while Turkey has been competing without incentives since 1997 within the framework of the ECSC. Dalbeler expressed that geopolitical and economic uncertainties, as well as rising energy and labor costs, negatively affect steel sectors outside the US, reducing capacity utilization rates.

US measures and China's export pressure

Dalbeler recalled that the additional customs duty, initially applied at 25% in the US, was increased to 50% in the new period and that steel derivatives were also included in the list. He stated that China, due to the contraction in domestic demand, increased its exports from 60 million tons to 120 million tons, intensifying price competition, and that it creates a decisive pressure in the global market due to its state-controlled structure and low-cost sensitivity.

Sector expectations: rapid trade policy and return to the table with the EU

Dalbeler stated that in the short term, the unfair competition created by imports from China and Russia should be swiftly eliminated, and simultaneously, a negotiation ground should be established for Turkey to be exempted from new regulations with the EU within both the ECSC and Customs Union frameworks.

Resilient export outlook

With the September performance, iron and steel exports exceeded 21 billion dollars in the first nine months of the year, accounting for approximately 11% of Turkey's total exports. Fuat Tosyalı expressed that they expect a stronger momentum in exports in the last quarter thanks to the recovery in demand in Europe and intra-regional logistical advantages, aiming to maintain the position in existing markets and establish a permanent presence in emerging regions.

Production balance in the EU, Turkey's position, and the 2026 risk

Following the decline in production in Germany, Turkey has risen to become the largest steel producer in the EU, ranking seventh globally. Dalbeler pointed out that steel is responsible for approximately 7% of global carbon emissions, stating that Turkey's ability to produce with up to 75% lower emissions offers an advantage. However, he noted that the EU safeguard measures in place since 2019 are on the agenda to be further tightened with a new package after June 2026. It is proposed to halve the current quota amounts and increase the 25% tariff applied outside the quota to 50%. Basing quota calculations on 2022–2024 data means a risk of over 60% decrease in Turkey's exports to the EU compared to 2025.

Conclusion: Timely negotiation and investment are essential

According to sector representatives, while the CBAM schedule continues to operate, Turkey's effective diplomacy with the EU, rapid deployment of trade defense tools, and acceleration of technology investments that reduce carbon costs will be decisive for safely navigating the 2026 curve.

Source: Demir Çelik Store