CBAM & the Carbon Cost of Your Supply Chain: What Procurement Needs to Know Now

CBAM, the EU’s carbon border adjustment mechanism, puts a carbon price on imports of cement, iron and steel, aluminium, fertilisers, electricity, and hydrogen. Importers buy certificates matching the carbon emitted making those goods, so goods made outside the EU cost the same, carbon-wise, as goods made inside it. The rules changed again in October 2025, and most of what’s published about CBAM online hasn’t caught up. CBAM sits inside a wider pattern of tariff and trade disruption hitting manufacturing supply chains right now. Understanding carbon border adjustment supply chain cost now, before certificates go on sale, is what separates procurement teams that budget for CBAM from teams that get surprised by it.

This is a CBAM procurement compliance manufacturing primer, built for teams asking whether any of this applies to them yet, not a deep dive for someone who already knows the mechanism. Only your suppliers can provide the emissions data this compliance work runs on. That makes procurement the team that has to own it, not customs or finance alone. Below: the six covered sectors and how CBAM works, the full timeline through 2027, October’s threshold change and who it exempts, what a certificate costs, what procurement has to do, and who to contact in Germany.

CBAM Basics: What It Is and Who It Applies To

What is CBAM, in plain terms?

CBAM (the carbon border adjustment mechanism) makes importers pay a carbon price on goods brought into the EU from outside it, per the European Commission’s official CBAM guidance. Formally, it’s set out in Regulation (EU) 2023/956. That price matches what a producer inside the EU already pays under the EU’s Emissions Trading System (ETS). It’s calculated per shipment, based on the actual or default CO2 emitted making that specific product.

Why did the EU introduce CBAM?

CBAM exists to stop EU climate policy from simply pushing emissions somewhere else. Without it, EU manufacturers who pay for their own carbon would compete against importers who don’t, so production, and the emissions with it, would just move outside the EU. The EU calls that shift carbon leakage, and closing that gap is the whole reason CBAM exists.

Which goods and sectors does CBAM currently cover?

Six sectors: cement, iron and steel, aluminium, fertilisers, electricity, and hydrogen, plus a defined set of precursor and downstream goods within those categories. If none of your imports fall here, CBAM doesn’t apply to you yet. The EU has already agreed a position to expand the list from 2028, though.

Is CBAM a tariff, a tax, or something else?

It’s a certificate-purchase obligation: importers buy CBAM certificates matching the embedded emissions in their goods, priced against the EU’s own carbon market. That behaves like a cost per tonne of CO2 in practice, though the legal structure is a compliance mechanism rather than a tariff or a tax.

Timeline: What’s Already Happened and What’s Next

What happened during CBAM’s transitional phase (2023–2025)?

From October 2023 to December 2025, importers had to report the emissions embedded in their goods every quarter, but paid nothing. That was deliberate: it gave the Commission real trade data before turning the mechanism into a financial one.

What changed when the definitive regime started on 1 January 2026?

From 1 January 2026, CBAM became a real financial obligation rather than only a reporting exercise. Importers who exceed the 50-tonne threshold, covered in the next section, must now hold authorised CBAM declarant status to import covered goods at all. Regulation 2025/2083 gives a grace window here: apply by 31 March 2026, and you can keep importing while the application is processed. That window covers your application, though. The authorisation requirement itself has applied since 1 January, the first day of the definitive regime.

When do companies actually have to start paying for CBAM certificates?

Not yet, in practical terms. Certificates go on sale from 1 February 2027, through the EU’s Common Central Platform, and cover emissions from goods imported during 2026. The first annual declaration and certificate surrender is due 30 September 2027.

The October 2025 Simplification: Do You Even Need to Comply?

What changed for CBAM in October 2025?

Regulation (EU) 2025/2083 replaced the old €150-per-consignment exemption with a single 50-tonne annual threshold, calculated cumulatively across your imports rather than per shipment. It applies per importer, tracked against your EORI number, across however many shipments that covers in a year.

Does the 50-tonne exemption mean my company doesn’t need to comply at all?

Only if you stay under it. The threshold works on an all-or-nothing basis. Cross 50 tonnes of CBAM goods in a calendar year, and full obligations apply to your entire annual import volume, from the first tonne.

The Commission’s own estimate: this exempts around 90% of importers while still covering about 99% of embedded emissions. That’s because the small number of importers above the threshold account for almost all the actual import volume.

Does the exemption apply to electricity or hydrogen imports?

No. The 50-tonne exemption excludes electricity and hydrogen entirely. Any volume of these two goods brings you into scope, regardless of size.

What CBAM Actually Costs

How is the price of a CBAM certificate calculated?

The Commission calculates it as the volume-weighted average of EU ETS auction prices, the same carbon price EU producers pay under the Emissions Trading System. In 2026, that price is set quarterly. From 2027, it moves to weekly. For manufacturers, that turns the carbon border adjustment mechanism into a real supply chain cost, tracked shipment by shipment.

What has the CBAM certificate price actually been so far in 2026? (current as of Q2 2026)

According to the EU’s published CBAM certificate prices, Q1 2026 was set at €75.36 per tonne of CO2, published 7 April 2026. Q2 2026 came in at €75.28, published 6 July. Both are the volume-weighted average of EU ETS auction clearing prices for that quarter.

Under the EU’s own phase-in schedule, only 2.5% of your embedded emissions require a certificate in 2026. That factor mirrors the parallel phase-out of free EU ETS allowances to European producers, which runs through 2034. In practice, it means your actual exposure this year is much smaller than the headline certificate price alone would suggest.

As an example: a steel importer with 2 tonnes of CO2 embedded per tonne of product faces a gross cost of roughly €150 per tonne at the Q1 price. The 2.5% factor cuts that to an actual 2026 exposure of around €3.75 per tonne. If you’re importing steel or aluminium, EU carbon border adjustment mechanism metals enforcement 2025 is exactly why this cost structure applies to you now. Those two sectors sit alongside cement, fertilisers, electricity, and hydrogen. All six are where the tightened rules actually bite. Multiply that per-tonne exposure across your annual import volume, and carbon border adjustment supply chain cost turns from an abstract policy line into a real budget number.

Can we reduce our CBAM cost if a carbon price was already paid abroad?

Yes. As of the October 2025 changes, you can deduct a carbon price already paid in any third country, no longer only the country of production. It has to be a legally binding carbon price, like a government-run ETS, tax, or levy. Credits bought on a purely voluntary basis don’t count toward this deduction. The exact mechanics are still being finalised. The European Commission published draft implementing rules in May 2026, but hadn’t adopted them as of this update. Confirm the current position with DEHSt before relying on a specific deduction.

What This Means for Procurement, Specifically

What does CBAM actually require from a procurement team, day to day?

First, you need embedded emissions data from every supplier of a CBAM-covered good. To use their actual figures instead of a default, that data has to be verified by an EU-accredited third party.

Second, that requirement needs to live inside your normal sourcing process rather than a separate compliance spreadsheet. Supplier onboarding is one place to check CBAM exposure. RFP criteria and contract renewal terms are two more. All of that has to happen before a purchase order exists.

What happens if a supplier can’t provide verified emissions data?

You fall back to a default value published by the European Commission. The Commission deliberately sets that default higher than typical actual emissions, with a mark-up on top, specifically to push suppliers toward providing verified data instead.

Either way, an unverified supplier is a more expensive supplier under CBAM, and that’s exactly the lever procurement has to negotiate with. This is where procurement compliance gets real: verified data or a costlier default. That’s the work behind CBAM procurement compliance manufacturing teams have to plan for: not the paperwork, but the supplier data behind it.

Germany-Specific: Who to Contact and How to Register

Who is responsible for enforcing CBAM in Germany?

Germany’s CBAM authority, DEHSt, the Deutsche Emissionshandelsstelle at the German Environment Agency (Umweltbundesamt), is Germany’s National Competent Authority for CBAM. Germany’s environment ministry (BMUV) appointed DEHSt to this role in December 2023. It’s the same authority that already runs Germany’s EU ETS and national emissions trading system.

How do you register for CBAM access in Germany?

Registration runs through the Zollportal, Germany’s customs portal. You’ll need an EORI number to access the CBAM Registry. DEHSt then reviews any application for authorised CBAM declarant status once it’s submitted. If you’re already registered in the CBAM transitional registry from the reporting-only phase, that registration carries over automatically.

For procurement, DEHSt is where the paperwork ends up, not where the compliance work starts. The registration itself only needs an EORI number and an import volume against the 50-tonne threshold. The harder part is upstream: getting verified emissions data from suppliers before a declaration is due, which is why that data-gathering has to sit inside sourcing and onboarding, not get handled as a customs task after the fact. In Germany specifically, that’s what CBAM procurement compliance manufacturing companies actually have to plan for. Registration is the easy part.

Frequently Asked Questions

Next Steps

For the full detail behind any answer above, the European Commission’s official CBAM guidance is the primary source, kept current as the regulation evolves.

Whatever your CBAM procurement compliance manufacturing status looks like today, the numbers above are worth revisiting once the certificate platform goes live in 2027. The short version of carbon border adjustment supply chain cost: it’s real, it’s already showing up in quarterly certificate prices, and it’s manageable if procurement starts gathering supplier data now.

This piece sits inside the Discrete Manufacturing pillar, JAGGAER’s broader look at tariff and trade disruption across manufacturing supply chains.