EU imports from Serbia in 2025 included about $640.7 million of iron and steel under HS Chapter 72 and another $573.5 million of articles of iron or steel under Chapter 73, for a gross envelope of roughly $1.21 billion. A large share of Serbia’s main steel exports, including hot-rolled, cold-rolled and coated flat products as well as downstream structures, tubes and fasteners, falls within the current CBAM product perimeter. At the same time, EU data used in a new steel safeguard framework show imports of the concerned products rising from 657,318 tonnes in 2024 to 760,234 tonnes in 2025.
CBAM coverage overlaps with Serbia’s core export categories
CBAM does not apply to every good in the broad HS72-plus-HS73 trade envelope because coverage depends on specified CN codes rather than general industry labels. Most of Chapter 72 is included, but ferrous waste and scrap under HS 7204 is outside the current Annex I list, as are specified ferro-alloys. Chapter 73 is more selective, with some downstream product families explicitly covered while others are not.
A first-pass mapping of Serbia’s 2025 trade suggests around €960 million of the roughly €1.07 billion broad HS72-plus-HS73 envelope falls clearly inside current CBAM headings, implying indicative coverage close to 90%. The figure would need reconciliation at CN8 level before being treated as audit-grade totals. The largest Chapter 72 flows show that CBAM exposure is concentrated in major export lines rather than marginal products.
EU imports from Serbia in 2025 included around $384 million of hot-rolled flat iron and non-alloy steel, $124 million of coated or plated flat products and $63 million of cold-rolled flat products. Together those categories accounted for almost $570 million. By comparison, ferrous scrap represented about $25 million.
Safeguard rules add a second access constraint
The carbon-border shift is occurring alongside EU tightening of steel trade protection. In August, the European Commission adopted rules implementing bilateral safeguard measures for steel products originating in countries with which the EU has free-trade agreements, including Serbia. The Commission’s analysis reported imports from Serbia at 664,743 tonnes in 2023, 657,318 tonnes in 2024 and 760,234 tonnes in 2025.
The EU described the increase over the 2023-2025 period as 14%, with the jump between 2024 and 2025 at about 15.7%. The safeguard product basket is not identical to the CBAM product basket, but both mechanisms affect commercial outcomes at the factory gate. A Serbian producer may therefore need to manage tariff-rate or safeguard constraints alongside product origin requirements, EU customer demand and carbon data tied to CBAM certificates.
Embedded emissions extend exposure beyond primary steelmaking
HBIS Group Serbia’s Smederevo steelworks is a central starting point because HBIS Group Serbia is the country’s dominant primary producer and sits within a supply chain reaching processors, fabricators, construction-product manufacturers, machinery suppliers and exporters. However, treating CBAM only as an HBIS issue overlooks exposure across downstream segments that export CBAM-relevant goods. EU imports from Serbia under Chapter 73 alone were worth more than $570 million in 2025.
Among the largest Chapter 73 lines were approximately $209 million of steel structures and structural parts, almost $147 million of other iron and steel articles, around $40 million of tubes and hollow profiles, and more than $26 million of screws, bolts and related fasteners. Many companies exporting these goods do not operate blast furnaces or produce crude steel. Their CBAM exposure can still start upstream through the emissions embedded in qualifying precursor steel they buy.
For downstream manufacturers, emissions incorporated in a qualifying precursor can become central to emissions assigned to the final CBAM good. This means a fabricator may have relatively low direct emissions at its own site while still facing substantial CBAM exposure due to embedded emissions in purchased steel. In this framework, “the carbon file follows the material” used for production.
Definitive-period evidence requirements focus on installation-level data
For a steel producer providing actual emissions to an EU customer, required information is not limited to general ESG estimates. The calculation must be linked to a defined installation identity and boundaries, production route and reporting period. It also requires fuel consumption and process emissions data plus material and energy balances tied to production volumes.
The evidence file described for practical implementation includes precursor quantities and embedded emissions for relevant precursors, allocation methodology and metering plus laboratory records. It also covers a monitoring plan; calculation files and data controls; product quantities with CN classification; linkage between EU customers and authorised declarants; and independent verification where actual values are used. For integrated steel production much of this information sits within a single industrial system.
For downstream processing the harder task can be upstream because accurate embedded emissions for complex CBAM goods depend on knowing emissions associated with precursor material entering a plant. Procurement practices historically focused on grade, dimensions, chemical properties, certification, price and delivery. Under CBAM requirements additional questions arise around which installation produced precursors, which production route was used and whether embedded emissions are based on verified actual data or default values.
Default values rise over time under current rules
Where suppliers cannot provide usable information, EU importers may rely on default values for embedded emissions when calculating CBAM liabilities. The definitive-period default system is described as deliberately conservative for iron and steel and aluminium. Applicable default values carry a 10% mark-up in 2026, rising to 20% in 2027 and 30% from 2028 onward.
This schedule creates a progressively stronger incentive to develop verified actual emissions where those values are competitive. The described outcome is likely to be a hierarchy among suppliers based on how quickly they can provide timely verified installation-level information versus partial data versus reliance on increasingly conservative defaults by customers. For EU buyers comparing similar Serbian suppliers on other parameters, differences can become visible through carbon cost attached to imported products.
Renewable electricity reduces corporate footprints but not direct embedded liability
The role of renewable electricity is described as needing careful treatment under the current definitive CBAM scope for iron and steel. Steel producers worldwide are signing renewable PPAs and building on-site solar plants to reduce energy costs and carbon footprints. Investments can reduce corporate emissions and improve ESG performance while supporting future decarbonisation.
However, under current definitive scope iron and steel are subject to direct embedded emissions rather than indirect electricity emissions. As a result buying renewable electricity does not automatically remove immediate CBAM liability associated with direct steelmaking emissions for routes such as blast-furnace/basic-oxygen-furnace where central challenge remains process carbon intensity itself.
CBAM certificate pricing links carbon costs to EU ETS levels
The price of CBAM certificates is linked to EU ETS auction prices published by the European Commission. The Commission published a Q1 2026 CBAM certificate price of €75.36 per tonne of CO₂, with €75.28 for Q2. The cost attached to a tonne of Serbian steel cannot be calculated simply by multiplying gross plant emissions by €75 because final calculations depend on relevant embedded emissions plus benchmark or free-allocation adjustments.
The final number also depends on any recognised carbon price already effectively paid and other regulatory parameters referenced in the calculation framework described here. Even so certificate pricing provides scale because small differences in verified embedded emissions can translate into meaningful differences across hundreds of thousands of tonnes imported under CBAM-covered CN codes.
Contract clauses and verification deadlines shape market access
The next stage involves commercial contracting between EU buyers and non-EU suppliers where buyers may demand more specific CBAM provisions from non-EU partners. Clauses can cover data-delivery deadlines; verification rights; access to installation information; accuracy warranties; treatment of default values; precursor data; allocation methodology; liability where incorrect data increases buyer costs; and cooperation with an accredited verifier.
The evidence described as required for definitive-period reporting includes verification where actual emissions are used. The European Commission published dedicated definitive-period steel guidance identified as Guidance 5d on Aug. 14 followed by verification and accreditation guidance later that month. The first annual CBAM declaration covering 2026 imports is due by Sept. 30, 2027.
The timeline implies that Serbia’s steel industry needs 2026 production data ready for evidence preparation during that year rather than waiting until after reporting starts for declarations due in 2027. Where evidence preparation is delayed it may result in incomplete audit trails such as meters not aligning with production boundaries or missing precursor documentation plus difficulties reconciling ERP records with emission calculations or allocating production batches retrospectively.
Serbian basic metals output weakens while downstream exports grow
Domestic production conditions also changed alongside these compliance requirements. Serbian industrial production data show output in basic metals down 12.5% year on year in January-July 2026, with July alone substantially weaker than a year earlier according to the figures cited here.
The trade picture is described as more nuanced because the National Bank of Serbia said exports from fabricated metal products excluding machinery and equipment increased 20.8% in January-July 2026. This indicates that primary or basic-metal production can weaken while downstream exporters continue performing strongly using existing inventories or imported materials or different product mixes alongside stronger foreign demand.
Evidencing requirements tie purchasing decisions into carbon accounting
A processor exporting structures or fasteners can depend on emissions information originating with a precursor supplier because embedded emissions flow into final CBAM goods through qualifying inputs purchased upstream. This makes carbon performance increasingly relevant for companies that previously treated carbon accounting as outside their operational scope based on procurement practices centered on mechanical specifications rather than installation-level emission evidence.
The evidence file requirements described here include linking precursor quantities to embedded emission factors tied to specific installations producing those precursors using defined production routes plus allocation methodology across product quantities classified by CN codes destined for particular EU customers or authorised declarants.
Smederevo-linked supply chains face combined carbon evidence needs
The Smederevo works remains central through HBIS Group Serbia’s position as dominant primary producer within supply chains covering processors fabricators construction-product manufacturers machinery suppliers and exporters serving EU markets. Exposure extends beyond blast-furnace operators because downstream exporters importing semi-finished inputs must obtain installation-level precursor emission information or rely on default values subject to mark-ups increasing after 2026. This creates an operational requirement for purchasing departments connected directly to carbon-control processes through precursor data availability.