The Impact of EU Carbon Border Regulation Mechanism on the Export Market Structure of China's Steel Industry
Main Article Content
Keywords
EU carbon border regulation mechanism, steel export, double difference method, market structure, trade crowding out
Abstract
The EU carbon border regulation mechanism was formally passed in May 2023 and officially implemented in January 2026. As the world's largest steel exporter, China is facing the expected impact of external carbon costs. Using the monthly export data of steel products in Chapter HS72 of China from January 2015 to December 2025, this paper uses the double difference method (DID) to study the impact of CBAM on the export market structure of China's steel industry. The study found that after controlling for the exchange rate, the comprehensive PMI of the euro area, the steel price index and the GDP of the importing countries, the DID coefficient changed from positive to negative. The results show that after the CBAM legislation was passed, China's steel exports to the EU decreased by about 10.9% compared with non-EU countries. After further adding the time fixed effect, the conclusion is still robust. This provides new empirical evidence for understanding the carbon tariff transmission mechanism. And it also provides enlightenment for China's steel industry to cope with the impact of CBAM and accelerate the low-carbon transformation.
References
- [1]Wang Tianpeng & Liu Xueye. (2026). The Impact of the EU Carbon Border Adjustment Mechanism New Regulations on China's Steel Exports and Coping Strategies. Journal of Sustainable Development Economics, (4), 31-34.
- [2]Liu Xiaqing & Zhao Lihua. (2023). The Impact of the EU Carbon Border Adjustment Mechanism on China's Steel Industry: Based on the Perspective of Product Carbon Footprint. China Metallurgy, 33(2), 135-140. https://doi.org/10.13228/j.boyuan.issn1006-9356.20220727.
- [3]Liu Bin & Zhao Fei. (2021). The impact of the EU Carbon Border Adjustment Mechanism on China's exports and policy recommendations. Journal of Tsinghua University (Philosophy and Social Sciences Edition), 36(6), 185-194, 210.
- [4]Zhang Qingbin, Gao Yu & Zhao Xiaoli. (2026). Analysis of the Impact of EU Carbon Tariffs on China's High Energy-Consuming Product Exports and Countermeasures. Resource Development and Market, 42(4), 550-562.
- [5]Pan Yuhong. (2024). A Study on the Impact of Carbon Tariffs on the Import and Export Trade of China's Steel Industry. China Market, (4), 64-67. https://doi.org/10.13939/j.cnki.zgsc.2024.04.017.
- [6] Li Tao, Shang Guan Fangqin, Li Xiuping, Cui Zhifeng, Zhou Jicheng & Ni Bing. (2023). The impact of CBAM on China's steel industry and response strategies. China Metallurgy, 33(8), 78-83, 91. https://doi.org/10.13228/j.boyuan.issn1006-9356.20230232.
- [7] Liu Xiaoyuan & Pang Bohong. (2026). A Study on the Trade Suppressive Effects of the EU Carbon Border Adjustment Mechanism (CBAM) —— Empirical Evidence from China's Steel Exports During the Transition Period and Coping Strategies. Knowledge Economy, (19), 3-6. https://doi.org/10.15880/j.cnki.zsjj.2026.19.006.
- [8]Tang Huiting, Shao Jianhua & Xia Qi. (2023). A Brief Analysis of the Impact of EU Carbon Tariffs on the Export Costs of China's Steel Industry. Metallurgical Economy and Management, (4), 11-14.
- [9]Yan, Q. (2024). Environmental Protection or Trade Barrier? — A Study on the Economic and Environmental Impacts of Carbon Tariffs on the Steel Industry. Journal of Nantong University (Social Sciences Edition), 40(2), 120-135.
- [10]Qu Yang. (2023). Research on the Impact of the New Asset Management Regulations on Financing and Investment of Real Economy Enterprises (Master's Thesis, Hunan University). Master's Thesis. https://doi.org/10.27135/d.cnki.ghudu.2023.003972.
Article Sidebar
This work is licensed under a Creative Commons Attribution 4.0 International License.