The European Union’s Carbon Border Adjustment Mechanism (CBAM) entered into full implementation in 2026, drastically reshaping the regional steel trade landscape. Under the new rules, the duty-free import quota for steel products has been cut from 33 million tonnes to 18.3 million tonnes, a reduction of 47%. Tariffs on imports exceeding the quota have been doubled from 25% to 50%. All incoming steel shipments now require full lifecycle carbon traceability data, forcing non-EU steelmakers to accelerate decarbonization or face higher costs. Chinese exporters are shifting focus to high-end plates, electrical steel, and low-carbon products to maintain market access, with several major mills signing new traceability agreements with European clients.