CBAM in 2026: What Wire & Cable Businesses Need to Do Now

From 1 January 2026, the EU’s Carbon Border Adjustment Mechanism (CBAM) moves into its definitive phase. For many in the wire and cable industry, this marks a fundamental change in how steel and aluminium inputs are priced, reported and traded into the EU.

What began as an emissions reporting exercise will become a real financial obligation at the EU border – with direct implications for cost, compliance and competitiveness.

This article outlines what CBAM means in practice and the key actions IWMA members should be taking now.

 

What Is Changing in 2026?

During the transitional phase (2023-2025), CBAM required importers to report embedded emissions only.

From 2026:

• CBAM certificates must be purchased and surrendered
• Costs will be linked directly to embedded carbon emissions
• Default emissions values (where data is missing) will be financially punitive
• Border compliance becomes a commercial and contractual issue

CBAM initially applies to steel and aluminium, making it particularly relevant to:

• steel wire and wire rod
• aluminium rod and conductors
• downstream wire and cable products using these inputs

 

Who Is Affected?

EU Manufacturers

Even where production is based in the EU, CBAM matters if:

• raw materials are imported from outside the EU
• suppliers cannot provide verified emissions data
• costs cannot be passed through to customers

Non-EU Exporters Supplying the EU

CBAM represents a direct market-access requirement.
Without emissions data and compliance readiness, exporters risk:

• higher border costs
• delivery delays
• or exclusion from EU supply chains altogether

 

Key Risks for Wire & Cable Businesses

• Unexpected cost increases on steel and aluminium inputs
• Margin erosion where CBAM costs are not contractually recoverable
• Border delays due to incomplete documentation
• Supplier risk where emissions data is unavailable or unreliable
• Competitive disadvantage versus lower-carbon producers

 

What Members Should Be Doing Now

1. Understand Your CBAM Exposure

Identify:

• which products and inputs fall under CBAM
• where steel and aluminium enter your value chain
• who is legally responsible for CBAM reporting and payment

Action: map CBAM exposure by product, supplier and market.

 

2. Secure Emissions Data Early

From 2026, verified emissions data is essential.

• Request data from suppliers now
• Confirm methodology used
• Flag suppliers unable to comply

Action: prioritise suppliers with transparent, auditable data.

 

3. Review Contracts and Pricing

Many contracts signed before CBAM do not account for carbon costs.

• Introduce CBAM or regulatory cost pass-through clauses
• Avoid fixed-price exposure without carbon protection
• Align pricing with emissions intensity

Action: update commercial terms before renewal cycles.

 

4. Strengthen Supplier Due Diligence

CBAM will operate alongside:

• forced-labour enforcement
• sanctions compliance
• enhanced supply-chain scrutiny

Action: extend due diligence beyond Tier-1 suppliers.

 

5. Treat CBAM as a Strategic Issue

CBAM is not just a cost – it is a signal of where EU policy is heading.

Businesses that are:

• low-carbon
• transparent
• and compliant

will be better placed for:

• EU infrastructure projects
• HVDC and grid investment
• long-term customer partnerships

 

CBAM and Long-Lead Projects

For HVDC, subsea and major grid projects, CBAM presents additional risk due to:

• long lead times
• fixed pricing
• multi-country supply chains

Early engagement with EPCs and customers to clarify:

• who bears CBAM costs
• how carbon risk is priced
• and how compliance is demonstrated

will be critical.

 

Key Message for Members

CBAM is not a temporary measure — it is a permanent change to how the EU trades.

Members who act early will protect margins, reduce border risk and strengthen their competitive position. Those who delay risk discovering CBAM only when shipments reach the border.

IWMA will continue to support members with guidance and insight as CBAM and wider trade policy evolve.

 

CBAM 2026 Readiness Checklist

A practical guide for wire & cable businesses

Use this checklist to assess whether your business is prepared for CBAM’s cost-bearing phase from 1 January 2026.

1. CBAM Exposure Mapping

☐ Identified all products and inputs covered by CBAM
☐ Mapped where steel and aluminium enter your supply chain
☐ Confirmed whether you are the CBAM declarant or reliant on a customer/importer
☐ Assessed exposure by market (EU vs non-EU sales)

2. Supplier Emissions Data

☐ Requested embedded emissions data from all relevant suppliers
☐ Confirmed data methodology (actual vs estimated)
☐ Identified suppliers unable or unwilling to provide verified data
☐ Avoided reliance on default CBAM values

3. Contracts & Pricing

☐ Reviewed existing contracts for CBAM cost exposure
☐ Added CBAM or regulatory cost pass-through clauses where possible
☐ Assessed fixed-price and long-term project risk
☐ Updated pricing models to reflect carbon intensity

4. Internal Processes & Ownership

☐ Assigned CBAM responsibility internally (finance / compliance / supply chain)
☐ Established internal CBAM reporting and documentation processes
☐ Aligned procurement, sales and finance teams on CBAM impacts
☐ Ensured record-keeping meets audit expectations

5. Supplier Due Diligence

☐ Extended due diligence beyond Tier-1 suppliers
☐ Reviewed suppliers for forced-labour and sanctions exposure
☐ Documented traceability for CBAM-relevant inputs
☐ Integrated compliance into supplier selection criteria

6. Logistics & Border Readiness

☐ Confirmed documentation required at EU border
☐ Allowed for potential border delays in delivery schedules
☐ Reviewed Incoterms and risk allocation
☐ Built CBAM compliance into logistics planning

7. Strategic Positioning

☐ Identified opportunities to shift to lower-carbon materials
☐ Used CBAM readiness as a sales and tender differentiator
☐ Engaged customers early on CBAM cost implications
☐ Factored CBAM into 2026–27 investment planning

For HVDC & Long-Lead Projects

☐ Clarified CBAM responsibility with EPCs and TSOs
☐ Built CBAM cost assumptions into project pricing
☐ Addressed carbon risk in contracts signed pre-2026
☐ Engaged early on compliance and documentation requirements

Final Check

☐ CBAM readiness reviewed at board or senior management level
☐ 2026 action plan agreed and resourced

Key Reminder

CBAM will be enforced at the border – preparation in advance is the only way to avoid disruption.

IWMA will continue to share updates, guidance and best practice as CBAM implementation progresses.