The European Union has introduced the CBAM aimed at reducing carbon emissions. Let’s look into its specifics and how we can ensure compliance in the sale of our ferroalloys.
CBAM stands for Carbon Border Adjustment Mechanism (CBAM), a system that aims to control carbon emissions and act as an incentive for companies operating in the iron and steel industry to adopt sustainable practises. As dealers of ferroalloys, the CBAM is very important to us as some of the materials we process have a significant carbon index. Let’s take a closer look at what this new environmental protocol envisages and how we can effectively reduce our ferroalloy emissions.
What is the CBAM
The CBAM is a mechanism introduced by the European Union makes it mandatory for companies to declare carbon emissions produced during the import/export processes of metals and ferroalloys and during their subsequent processing.
This procedure began its transitional period on 1 October 2023 and shall become fully mandatory in 2026. This means that by 31 January 2024 companies operating in the iron and steel industry shall be required to submit a report stating the carbon emissions for the fourth quarter of 2023.
The aim of these reports is to monitor Co2 emissions in the European Union and to ensure compliance with the envisaged environmental sustainability objectives. Furthermore, the introduction of the CBAM foresees a knock-on effect where European companies will also encourage their NON-EU suppliers and customers to adopt green policies for the extraction, production and processing of metals and ferroalloys.
Which industries are affected
The CBAM mainly concerns the iron and teel industry, but affects all industrial sectors that use metal and ferroalloys components in their production processes. In addition to foundries and raw material dealers, the CBAM also has an impact on the automotive sector, the metallurgical sector and manufacturers of electrical and electronic components, generating a positive knock-on impact on the all aspects of industrial production.
How will Al.Fa. Laminati comply with the CBAM requirements
As far as our operating processes are concerned, in the first transitional phase of the CBAM we shall be required to report the quantities of ferro manganese we import and proof of compliance of our suppliers with a series of environmental requirements that determine the emissions of carbon into the atmosphere during the import and processing phases of this ferroalloy.
We have already enrolled with the CBAM transitional registry and have started collecting from our suppliers all the certifications attesting to the origin of the lots of ferro manganese that we sell and their impact on the environment.
In the coming years, however, we expect that the legislation for a more sustainable Europe will also be extended to other ferroalloys, which is why we are preparing to document the origin of the other raw materials we sell, so as to guarantee eco-friendly products to the foundries and iron and steel companies we serve.