Strengthening CBAM Implementation: Steel Industry Adapts for Sustainable Exports

The Vietnamese government has just issued a notice on implementing tasks related to the European Union’s Carbon Border Adjustment Mechanism (CBAM). This presents a new challenge for exporting businesses, especially in the steel industry. In this context, transportation and logistics companies need to prepare to adapt to upcoming changes in international shipping activities.

The Ministry of Industry and Trade has been assigned to lead the development and implementation of the CBAM response plan. This will directly affect import and export services, requiring close coordination between ministries and businesses. Forwarding companies need to update information regularly to prepare for changes in goods transportation processes.

Domestic steel manufacturing companies are required to shift production towards “greening” to enhance competitiveness.

CBAM is currently in Phase 1, requiring exporting businesses to declare emission levels. From 2026, businesses will have to purchase CBAM emission certificates, which could increase sea freight and maritime shipping costs. Shipping companies need to consider adjusting strategies to maintain competitiveness.

According to WTO estimates, the steel sector could see a 4% reduction in export value due to CBAM’s impact. This will affect the demand for freight services in the steel industry. Transportation companies need to prepare for this potential decline and seek new opportunities in other sectors.

Besides CBAM, Vietnam’s steel industry also faces fierce competition from the domestic market and pressure from imported steel. In this situation, international shipping and overseas delivery services need flexible strategies to meet changing market demands.

Although CBAM is a short-term challenge, in the long term, it could be an opportunity for Vietnamese businesses to improve product quality and develop sustainably. Shipping companies could consider investing in green technology to support customers in this transition, thereby creating new competitive advantages.

To cope with CBAM, steel businesses need to transition production towards “greening.” This will create new demands for freight services, especially for transporting equipment and materials for green production. Transportation companies might consider investing in environmentally friendly vehicle fleets to meet this trend.