For decades, aluminium producers and exporters have been locked in familiar battles, fighting for price, pushing volumes and struggling to balance costs with quality. In recent years, trade wars, tariff disputes and shifting geopolitics have only added to the strain. Margins are constantly squeezed and competition grows fiercer.
Now, another layer of pressure is taking shape and this one will be decided at the border.
The Carbon Border Adjustment Mechanism (CBAM) is not new. The European Union adopted it in 2023 and since October last year, exporters of aluminium into the EU have already been required to file quarterly reports on the carbon emissions tied to their products. What changes in January 2026 is that the “dry run” ends. From then on, importers will need to buy CBAM certificates for goods with emissions above EU benchmarks. In effect, the carbon cost moves from paperwork to price.
Image used for representational purpose
CBAM to affect aluminium
Aluminium is on the front line. Alongside cement, steel, hydrogen, fertilisers and electricity, it is one of the first sectors covered by CBAM. And it’s not “aluminium in general” but only specific products defined under HS/CN codes in Chapter 76.
For example:
- 7601: Unwrought aluminium (ingots, billets, slabs)
- 7604: Aluminium bars, rods and profiles
- 7606: Aluminium plates and sheets
- 7609: Aluminium tube or pipe fittings
For producers outside Europe, this changes the game. Trade wars and tariff volatility already stress export margins and now CBAM adds a carbon cost layer that could quietly price exporters out of the EU market.
CBAM: A rescue or wider mechanism
But CBAM is not just a barrier. It can also be an opening. Producers who can prove their aluminium is low-carbon through cleaner energy, efficient melting, higher scrap use, or verified data, won’t just avoid costs. They may even find new buyers willing to pay a premium for sustainability.
This is just the beginning of the story. In the next column, we’ll explore why aluminium, more than many other metals, is so exposed to CBAM and what that means for producers, processors and exporters worldwide.
HS/CN codes for aluminium products covered under CBAM
| HS/CN Code | Product Description | CBAM Relevance |
| 7601 | Unwrought aluminium (primary or secondary ingots, billets, slabs) | Directly included – core input material |
| 7604 | Aluminium bars, rods, and profiles | Includes extruded profiles – major export category |
| 7605 | Aluminium wire | Covered due to high energy footprint in production |
| 7606 | Aluminium plates, sheets and strips | Rolled products with significant carbon intensity |
| 7607 | Aluminium foil | Important for packaging exports |
| 7608 | Aluminium tubes and pipes | Industrial and construction uses |
| 7609 | Aluminium tube or pipe fittings | Ancillary but included in CBAM scope |