By Abbas Nazil
Türkiye’s steel industry is facing growing uncertainty as European Union carbon border measures scheduled for 2026 threaten to sharply reduce exports to the bloc.
Industry leaders warn that the Carbon Border Adjustment Mechanism, combined with proposed import quotas, could become the most serious challenge the sector has faced in years.
The Turkish Steel Producers Association said the new measures pose a greater immediate risk than China’s excess steel capacity, which has long pressured global markets.
TCUD Chairman Veysel Yayan stated that the EU’s policies could significantly damage Turkish steel exports just as production and trade volumes are recovering.
He cautioned that the combination of carbon taxes and safeguard quotas may push free trade between Türkiye and the EU close to a standstill.
The carbon border tax will require EU importers to pay levies on steel unless exporting countries apply carbon pricing systems comparable to EU standards.
Because Türkiye does not yet have a fully aligned domestic carbon pricing mechanism, its steelmakers may face higher costs and reduced competitiveness.
In addition to CBAM, the European Commission plans to introduce new import quotas in the second half of 2026 to protect EU producers.
These safeguards could cut tariff free steel imports by as much as 47 percent, limiting volumes to 18.3 million tons annually.
Yayan urged Turkish authorities to consider reciprocal measures to protect domestic producers and ensure long term sector sustainability.
He emphasized the need for a balanced response that addresses regulatory risks while preserving access to key export markets.
The EU remains Türkiye’s largest steel export destination, accounting for roughly one fifth of total steel exports.
According to Eurostat, Türkiye exported 4.63 million tons of steel worth €3.5 billion to the EU in 2024.
Despite these risks, Türkiye’s steel production showed signs of recovery in 2025.
Crude steel output reached 3.3 million tons in November, representing a 10 percent increase year on year.
Total production for the first eleven months of 2025 rose to 34.6 million tons, up 2 percent from the previous year.
Steel exports climbed strongly in November, increasing more than 22 percent in volume terms.
Imports declined during the same month, helping improve the export to import coverage ratio.
For January through November 2025, the coverage ratio rose to nearly 77 percent.
Industry representatives warn that this fragile recovery could be undermined if EU carbon taxes and quotas are implemented without accommodation for Turkish producers.
