If you fabricate structural steel in the Gulf and any of it ends up in the EU, this September matters more than it looks. The European Parliament is voting on extending the Carbon Border Adjustment Mechanism (CBAM) to roughly 180 to 450 more steel- and aluminium-heavy products, depending on whose list wins. And 12 months from now, on 30 September 2027, EU importers file the first CBAM declaration that comes with a bill attached.
Most of the Gulf commentary on CBAM is about aluminium smelters and steel mills, because that is where the tonnage is. Coral's analysis puts UAE exports of CBAM-covered goods at about US$2.7 billion in 2023, with aluminium making up 68 to 75 percent of covered exports for the UAE, Oman and Saudi Arabia. Fabricators get less attention. They shouldn't, because one of the product codes already inside CBAM is exactly what a fabrication shop ships.
Fabricated structures are already in scope
CN code 7308 covers structures and parts of structures of iron or steel: bridge sections, towers, lattice masts, roof frameworks, columns, and "plates, rods, angles, shapes, sections, tubes and the like, prepared for use in structures". It is listed in Annex I of the CBAM Regulation (EU) 2023/956 alongside the mill products of chapter 72, and guides to the chapter 73 codes point out that for structural assemblies the upstream steel emissions flow through mass-balance rules, which is where it gets complicated.
So this isn't a 2028 problem for a steel structure fabricator. The transitional reporting period ran from October 2023 to the end of 2025. Since 1 January 2026 the definitive period applies, and EU importers of your 7308 goods are building up a certificate obligation for every tonne they bring in this year.
What changed in the last twelve months
- The simplification package. Regulation (EU) 2025/2083 replaced the old per-consignment exemption with a single 50-tonne annual threshold per importer, required importers above it to hold "authorised CBAM declarant" status, and moved the first annual declaration and certificate surrender to 30 September 2027, covering 2026 imports.
- The money is small this year, then it isn't. Because about 97.5 percent of EU free allocation still applies in 2026, only around 2.5 percent of the gross carbon cost is payable on 2026 imports, according to Coral's calculation. The same analysis notes that the mark-up on default values rises to 30 percent from 2028, and free allocation is scheduled to reach zero by 2034.
- The downstream extension. On 17 December 2025 the Commission proposed adding 180 downstream products with an average steel or aluminium content of 79 percent, from 1 January 2028. The Council's general approach on 12 June 2026 went to about 200 goods; Parliament's environment committee voted on 9 July for a list of 457, according to the Parliament's research service. Trilogue follows the plenary vote.
For the new downstream goods, the Commission's text is explicit: only the emissions embedded in the steel and aluminium precursors count, not the emissions from downstream processing or assembly. Their example is a car door: CBAM applies to the steel plate inside it, not to stamping it. For iron and steel goods generally, CBAM counts direct emissions only; indirect emissions from electricity apply to cement and fertilisers.
Why the fabricator ends up holding the data problem
Read those rules from a fabrication shop's point of view and the conclusion is uncomfortable. Your own welding, cutting and painting barely register. Almost all the embedded carbon in a truss is the carbon in the plate and sections you bought. That means the number your EU customer needs from you is mostly a number from your mills, attributed to the right shipment.
The EU importer can always fall back on default values. The problem is that defaults are set high on purpose and the mark-up grows each year. An importer who can get verified, installation-level data from you pays less. An importer who can't may start preferring a fabricator who can, or pushing the cost difference back onto your price.
To give them actual values, you need to answer four questions for every shipment:
- Which mills and installations produced the steel that went into these assemblies?
- How many tonnes from each of them?
- How much steel was consumed to make the shipped tonnage, not just how much was shipped? Offcuts and scrap are part of the precursor mass.
- Does each mill have an emissions figure for that product, and is it verified?
The fourth question is between you and your mill. The first three are yours, and they are traceability questions. They are the same questions a quality auditor asks when a heat is quarantined, and the same ones behind the EU digital product passport for construction steel.
Where shops lose the thread
In most fabrication shops we have seen, the mill certificate is filed when the steel arrives and the heat number is painted on the bar. Then the bar gets cut. Six parts from one bar end up in four assemblies across two shipments, the offcut goes back to the rack with no marking, and three weeks later someone uses it on a different project.
At that point nobody can say, for a given shipment, how many tonnes came from which mill. You can estimate it from purchase orders for a whole project. You can't defend that estimate to a verifier, and it falls apart on any project that draws from mixed stock, which is most of them. We described the recall version of this problem in our piece on traceability and recall risk. CBAM is the same gap with a price per tonne on it.
What to put in place before the 2027 filing
- Carry the heat number through cutting. Every cut part inherits the heat of the bar or plate it came from, and so does every offcut you keep. If this happens on paper today, it will fail the first time a job gets busy.
- Record weights at shipment, per assembly. A shipment record that lists assemblies, their weights and the heats inside them lets you roll tonnage up by mill without re-measuring anything.
- Track yield. Keep the ratio of steel consumed to steel shipped per job. Your importer's precursor mass depends on it, and it is also the cheapest way to see where offcuts disappear.
- Ask your mills now. Find out which of them can give you installation-specific emissions for the products you buy, and in what format. Some Gulf mills are well ahead on this. Others will send you a sustainability report and hope that's enough.
- Agree the handover with each EU customer. Who compiles the emissions communication, in what template, and by when. 30 September 2027 is a deadline for the importer; they will want your data months earlier.
Where Fidar MES fits, and where it doesn't
Fidar MES was built for structural steel shops, and the chain it keeps is heat number to mill certificate to material to part. A cut part inherits its heat. Offcuts above a set length stay in stock as usable remnants with their heat, and the nesting step records yield for each bar it plans. Shipments snapshot the weight of what is loaded, and each assembly still points back to its parts and their heats. Getting tonnage per mill for a shipment out of that is a query over records you already have, not a new data collection exercise.
What Fidar does not do: it doesn't calculate embedded emissions, it doesn't store your mills' emission factors, and it doesn't file anything with the EU CBAM Registry. Those belong to your mill, your importer and whoever they use for the declaration. Our part is making sure the tonnage-by-source answer exists and holds up when someone checks it.
If you're still working out what an MES should cover in a fabrication shop, start with what an MES is for steel fabrication. The regulation will keep moving through trilogue this autumn. The data you need for 2026 imports is being created on your shop floor right now, whether you record it or not. If you are in the UAE, the same records also carry a one-day Factory Forward ITTI assessment; we listed what a steel fabricator can show in that assessment.
