CBAM uncertainty Northern Europe’s main coil price stimulus

Northern Europe’s mills and stockists fear that demand will not support an uptick in coil prices before the end of 2025.

Despite recent interest rate cuts in the EU and United Kingdom, and positivity around the German government’s plans to invest in infrastructure and defence, sentiment has remained negative, this month. 

MEPS's prices were unchanged month-on-month in Belgium, France, Germany and the UK. This was despite two ArcelorMittal list price increases, totalling EUR50 per tonne. 

Sales stalled and most mills implemented maintenance stoppages of two-to-three weeks during the summer holiday period. Some of Europe’s major steelmakers are implementing longer-term production cuts. 

Domestic mills’ reduced output and increased offer prices may have mitigated a decline which has left Northern EU values at their lowest point this year. Buyers in France said that prices bottomed in mid-July, before rising moderately. They add that EU mills' delivery lead times have lengthened to October or November for certain sizes of galvanised coils, possibly helping to stabilise prices of that product. 

Importers’ uncertainty intensifies 

Uncertainty around the cost of new CBAM taxes, from January 1, and the future of the EU import safeguard measures, are stifling the import market. All MEPS respondents in the EU expect these factors to be the main source of upward price pressure in the coming months. 

• This market commentary was first published in the August edition of MEPS's European Steel Review. Subscribe to be among the first recipients of the review monthly review, which features steel prices, indices, commentaries and forecasts covering Belgium, France, Germany, Italy, Spain and the UK. Contact MEPS for more details.

German importers say that suppliers in Indonesia and South Korea and starting to offer “free on truck” delivery terms or offering to absorb the as-yet-unknown cost of CBAM taxes. Furthermore, hedging against CBAM is now being offered by certain European banks. 

The UK government’s tightening of its import safeguard quotas has increased duties on galvanised coil, in particular. High volumes of galvanised coil are now sitting at UK docks, awaiting customs clearance in October. 

Offers of Asian-origin hot rolled coil into the UK are around GBP50 per tonne cheaper than the EU equivalent. Furthermore, UK stockholders have high inventories of cold rolled coil. 

Automotive sector in decline 

Demand from high-margin projects has maintained sales for some stockists in Belgium and the UK. Generally, large projects are in short supply. 

Northern Europe’s automotive sector is struggling amid reduced sales and intense competition from Chinese electric vehicles. Despite new EU import taxes, Chinese brands' sales grew by 91% year-on-year in the first half of 2025, reaching 347,135 units, according to Jato Dynamics. 

Eurofer expects EU vehicle production to decline by 2.6% year-on-year in 2025, following a 9.7% dip last year. UK car production was down 7.3% year-to-date, in June, at 385,810 units – its lowest level since 1953.  

Steelmakers need coil prices to rise ahead of contract talks with automotive OEMs keen to make cost savings.