Guides. Omar Hamdy, on the lender's side, in Cairo. Written in a personal capacity.

Last checked 2 November 2026

CBAM for Egyptian steel rebar: a borrowed default, a blast-furnace deduction, and why your production route decides the bill

Egypt has no default figure of its own for rebar, so an EU importer declaring on the default uses the figure set for countries without their own entry, 3.996 tCO2e per tonne, and a deduction built on the blast furnace route. Egyptian mills mostly make steel by direct reduction or from scrap in electric arc furnaces. This page applies the CBAM hub for Egyptian exporters to reinforcing bar and the bars traded next to it, and sets out what the legal texts say about the deduction on each basis.

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What counts as rebar under CBAM

All of chapter 72 is in CBAM except the excluded ferro-alloys and scrap (Annex I of Regulation (EU) 2023/956). Rebar sits in two headings, and the alloy bars that Egypt now sells to the EU sit in a third.

Route letters, as defined in Implementing Regulation (EU) 2025/2620: (C) carbon steel from blast furnace and basic oxygen furnace; (D) carbon steel from direct reduced iron (DRI) and electric arc furnace; (E) carbon steel from scrap and electric arc furnace; (F) low alloy steel from blast furnace.

Sources: defaults, Implementing Regulation (EU) 2025/2621, Annex I, tables "Egypt" and "Other countries and territories", as replaced by (EU) 2026/1740 (Official Journal text, read from the Publications Office copy). Benchmarks, Implementing Regulation (EU) 2025/2620, Annex, point 5.3, checked against the Commission's Excel of 6 February 2026. For the alloy line, point 5.1 of that Annex says that where several alloy grades are given for one CN code, the highest benchmark for the production year is used with defaults; only the (F), (G), (H) and (J) grades are listed for 7228 30 69, and (F) is the highest.

The precursors in the chain, with their own benchmarks from the same Annex:

The DRI benchmark is a dedicated CBAM benchmark. Recital 16 of 2025/2620 explains it: without it, gas-based DRI would have received a deduction larger than its embedded emissions, and the benchmark was set so that DRI-based steel carries a CBAM cost below blast furnace steel and above scrap-based steel.

EU imports of rebar and alloy bars from Egypt

Egypt's share of what the EU imported from outside the EU, by tonnes: for 7214 20 00, 23.1% in 2023, 21.8% in 2024 and 14.1% in 2025; for 7228 30 69, 2.2%, 2.1% and 38.7%.

Source: Eurostat Comext, dataset DS-045409, reporter EU, partners Egypt and extra-EU, imports, CN 7214 20 00, 7213 10 00 and 7228 30 69, annual, dataset version of 16 October 2026, queried 2 November 2026 through the Eurostat API. Shares are my division of Egypt's tonnes by extra-EU tonnes (1,497,073 for 7214 20 00 and 681,505 for 7228 30 69 in 2025).

Classification matters under CBAM. CBAM follows the CN code declared at import, and the two headings are treated differently at every step: the default is 3.996 for 7214 20 00 and 5.400 for 7228 30; the default-case benchmark is 1.364 against 1.613; the process benchmark for actual data is 0.038 against 0.109; and the steel behind an alloy bar is benchmarked as low alloy or high alloy steel, not carbon steel (2025/2620, Annex, point 5.2.3). Whether a bar is alloy steel is a customs question, settled by the Combined Nomenclature's definition of alloy steel in Note 1(f) to chapter 72, not by CBAM. Both headings are in scope, so neither takes a product out of CBAM.

The default and the mark-up, year by year

Each line is the default with its mark-up, minus the Column B benchmark times the CBAM factor: for rebar 3.996 x 1.10 minus 1.364 x 0.975 = 3.066 in 2026. Sources: mark-ups, Implementing Regulation (EU) 2025/2621, Annex I, opening paragraphs, as replaced by (EU) 2026/1740; CBAM factor, Directive 2003/87/EC, Article 10a(1a); benchmarks, 2025/2620, Annex, point 5.3. The cross-sectoral correction factor is 100% for every year from 2026 to 2030 (Implementing Decision (EU) 2026/1862, Article 1); for later years it is not yet set and is taken here as 1. Egypt has no carbon price, so nothing is deducted for carbon paid at home.

For the whole flow, as an illustration. If the 2025 tonnes entered again, all on the default, the importers of the 210,580 tonnes of rebar under 7214 20 00 would owe about 0.65 million certificates in 2026, 0.84 million in 2028 and 1.09 million from 2034. The 263,649 tonnes of alloy bars under 7228 30 69 would owe about 1.15 million in 2026, 1.51 million in 2028 and 1.85 million from 2034. This is my arithmetic on the figures above, not a forecast.

The deduction: what the legal texts say

The certificate count is embedded emissions minus a free allocation adjustment. The adjustment is the specific embedded free allocation (SEFA) of the good times the tonnes imported (Implementing Regulation (EU) 2025/2620, Article 1 and Annex, point 2). The texts set two ways to work out SEFA, and the basis of the adjustment follows the basis of the emissions (Article 3 and recital 5).

The default case. Where the declaration uses default figures for emissions, SEFA is the Column B benchmark times the CBAM factor and the cross-sectoral correction factor (Article 3; Annex, point 4, Equation 6). The benchmark is chosen by the country of origin, the CN code and the production route that Annex I of 2025/2621 gives for that country (Annex, points 4 and 5.1). The opening paragraphs of Annex I, as replaced by 2026/1740, say the same: where default figures are used, the free allocation follows "the corresponding underlying production route". For Egyptian rebar that route is (C), so the deduction is 1.364 times the factors, whatever route the mill actually uses. The default figure itself, 3.996, is also a blast furnace level figure. Both sides of the subtraction assume a blast furnace.

The actual-data case. Where the declaration uses verified actual emissions, SEFA is built up along the production chain (Article 2; Annex, point 3):

1. Each production process gets its own Column A benchmark times the factors (Equation 2). For rebar the rolling step is 0.038 (CN 7214 20 00 or 7213 10 00).
2. Each precursor adds its specific mass times its own SEFA (Equation 4). The specific mass is the tonnes of precursor consumed per tonne of product, measured under the methodology regulation (Equation 5; Implementing Regulation (EU) 2025/2547, Annex II, points E and F).
3. Precursors that are themselves complex goods are worked out the same way, step by step, until no precursor is left (Annex, point 3.3).
4. Where a precursor comes from another producer who supplies no verified figure, its Column B benchmark is used instead, chosen by its country of origin, CN code and default route (Annex, point 3.3, method (2)).

For an Egyptian rebar mill the chain is: billet (7207) into rebar; DRI (7203), pig iron (7201) or both into the billet; pellets (2601 12) into the DRI. Scrap is not a CBAM good and carries no benchmark; the route shows up through how much DRI or pig iron goes into each tonne of billet. Written out for a mill that makes its own DRI and buys pellets:

SEFA of rebar = 0.038 + (tonnes of billet per tonne of rebar) x [0.065 + (tonnes of DRI per tonne of billet) x (0.295 + tonnes of pellets per tonne of DRI x 0.086)], all times the CBAM factor and the correction factor.

The 0.065 is the Column A figure for carbon steel billet on route (D) or (E); the two are the same, so a mill charging a mix of DRI and scrap uses 0.065 for the furnace and casting step in either case. A mill on the blast furnace route would use 0.188 and add pig iron at 1.089. The structure is the one in Equations 2 to 5 of 2025/2620, and the Commission's iron and steel guidance works an example of it for bars: 0.038 plus 1.042 tonnes of crude steel times that steel's own figure (Guidance document 5d, 14 August 2026, Table 4-6).

What this does to the deduction. On actual data a DRI-based mill gets a much smaller deduction than the 1.364 used on the default, and a scrap-based mill a smaller one still. That is the intended result (recital 16 of 2025/2620). It does not make the default the better choice: the default figure of 3.996 plus mark-up is far above what the deduction difference gives back. The worked example below shows the size of both effects.

Worked example and calculator

The mill is fictional. The "actual" emissions and all three consumption ratios are assumptions chosen to show the arithmetic, not figures for any real Egyptian mill. P is the certificate price in euros per tonne of CO2e, from the Commission's "Price of CBAM certificates" page.

Inputs (illustrative): 10,000 tonnes of rebar, CN 7214 20 00, produced and imported in 2026, from a mill that makes its own DRI and charges it with scrap in an electric arc furnace. Verified direct embedded emissions, including the billet, DRI and pellets, 1.000 tCO2e per tonne of rebar (assumed). 1.05 tonnes of billet per tonne of rebar, 0.80 tonnes of DRI per tonne of billet, 1.40 tonnes of pellets per tonne of DRI (all assumed).

1. Embedded emissions. Default: 10,000 x 3.996 x 1.10 = 43,956 tCO2e. Actual: 10,000 x 1.000 = 10,000 tCO2e.
2. Deduction. Default: 10,000 x 1.364 x 0.975 = 13,299 tCO2e. Actual: the chain gives 0.295 + 1.40 x 0.086 = 0.4154 for the DRI, 0.065 + 0.80 x 0.4154 = 0.3973 for the billet and 0.038 + 1.05 x 0.3973 = 0.4552 for the rebar; 10,000 x 0.4552 x 0.975 = 4,438 tCO2e.
3. Certificates. Default: 30,657. Actual: 5,562.
4. Cost. Default: 30,657 x P. Actual: 5,562 x P. The gap is 25,095 x P: every EUR 1 of certificate price adds about EUR 2.51 per tonne of rebar to the cost of staying on the default.

The break-even. With these ratios, actual data is cheaper for rebar while the verified figure stays below about 3.510 tCO2e per tonne in 2026. For a mill on scrap only (no DRI, same billet ratio) the actual-data benchmark is 0.106 and the line is about 3.169. Both lines are more than two thirds of the default with its mark-up (4.396), so actual data is cheaper unless the verified figure comes close to the blast furnace level the default assumes.

Work it out: certificates and cost

CN line7214 20 00: Rebar, straight bars7213 10 00: Rebar in coils7228 30 69: Alloy steel bars, round, under 80 mm

Import year202620272028202920302031203220332034

Tonnes imported into the EU

Certificate price P, EUR per tonne of CO2eType the current figure from the Commission's page. This site states no price.

Your verified emissions, tCO2e per tonne (optional)Direct plus indirect where they count. Leave empty to see the default only.

Illustrative arithmetic on public figures, not advice for a shipment. Cross-sectoral correction factor fixed at 100% for 2026 to 2030 by Implementing Decision (EU) 2026/1862, Article 1; taken as 1 after 2030. No carbon price paid in Egypt is deducted.

Defaults: Implementing Regulation (EU) 2025/2621 as replaced by 2026/1740. Benchmarks: 2025/2620. CBAM factor: Directive 2003/87/EC, Article 10a(1a).

The calculator runs in your browser and sends nothing. For straight rebar and rebar in coils, type your verified figure and your three ratios to see the actual-data result; leave the DRI ratio at 0 for a mill on scrap only. The alloy line is shown on the default only, for the reason set out below. Certificates equal embedded emissions minus the deduction, never below zero.

What is not settled

• Benchmarks from 2027. Recital 10 of 2025/2620 says the CBAM benchmarks are to be reviewed once the final EU ETS benchmarks for 2026 to 2030 are published, with the updated figures applying to goods imported from 1 January 2027, and the regulation is to be revised in 2027. At 2 November 2026 the Commission's page still carries the benchmarks as first published. Every 2027 and later figure on this page may change.
• Integrated mills with one joint process. A mill that makes DRI, steel and bar in one installation may monitor them as one joint production process (Implementing Regulation (EU) 2025/2547, Article 4(9)). The binding text of 2025/2620 does not say in terms how SEFA is split in that case. The Commission's guidance says the chain still applies, and that the mill must also record the CN code of each intermediate product and the tonnes of each consumed per tonne of the next (Guidance document 4, section 2.2.2). Guidance is not binding, but a verifier is likely to ask for those figures.
• Alloy bars on actual data. For 7228 30 69 the deduction depends on whether the steel is low alloy or high alloy and on the CN code of the semi-finished product, and the Column A figures for those differ (for example 0.100 or 0.330 for low alloy semi-finished products from an electric arc furnace, depending on the product). I have not modelled that chain, so this page gives the alloy line on the default only.
• Years after 2030. The benchmarks in 2025/2620 and the correction factor in Decision 2026/1862 cover 2026 to 2030. The calculator keeps the 2030 figures for 2031 to 2033; the CBAM factor reaches zero in 2034, so the benchmark no longer matters then.

What your EU importer and the verifier will ask for

• The exact CN code, shipment by shipment, matched to the customs declaration: 7214 20 00, 7213 10 00 or 7228 30 69. The default and both benchmarks change with it.
• Installation identity: operator, address, coordinates and main activity, the fields used to register an installation in the EU CBAM registry (Article 10 of Regulation (EU) 2023/956). A rolling mill that buys billet is a separate installation from the melt shop that made it.
• The production route of the steel: DRI and electric arc furnace, scrap and electric arc furnace, or blast furnace, with the tonnes of scrap per tonne of steel and the share of pre-consumer scrap (Implementing Regulation (EU) 2025/2547, Annex IV, point 2).
• Direct emissions per tonne, for the reporting period, calculated under Implementing Regulation (EU) 2025/2547: natural gas in the DRI plant and reheating furnace, electrodes, carbon in charge materials and lime, with the carbon mass balance.
• Each precursor: tonnes of billet per tonne of bar, tonnes of DRI and pig iron per tonne of billet, tonnes of pellets per tonne of DRI, and for each one bought in, the producer, country and its verified embedded emissions (Annex II, point E). If the country of a bought-in precursor cannot be shown, much higher figures apply: 4.200 tCO2e per tonne for DRI, 7.920 for pig iron and 8.230 for carbon steel billet, before mark-up (Annex IV of 2025/2621 as replaced).
• The alloy content of each grade: mass % of manganese, chromium, nickel and other alloy elements (Annex IV, point 2), because it decides the CN heading and the steel class.
• A verification report from an accredited verifier, if the importer is to declare on actual data (Article 8 and Annex VI of Regulation (EU) 2023/956).
• A named contact and a date for next year's update.

The lender's view

For rebar the default assumes a route most Egyptian mills do not use. The default figure and the default deduction are both blast furnace figures. In the example above, the default costs about 3.07 certificates per tonne in 2026 and actual data about 0.56, on assumed mill figures. A lender should read the gap as the measure of what verified data is worth to the borrower's EU sales.

What a lender wants to see before counting a CBAM benefit in a decarbonisation loan:

• A verified baseline per tonne for each CN code sold into the EU, with the route and the precursor ratios behind it. A project at a mill that stays on defaults changes nothing on the bill.
• The project's effect in tCO2e per tonne of bar, and its effect on the deduction. A higher scrap share lowers embedded emissions but also lowers the actual-data deduction, because less DRI goes into each tonne. The net is what counts; the calculator shows it.
• No CBAM credit for renewable power at the mill. Indirect emissions do not count for steel, so a solar plant or a renewable supply contract cuts the electricity bill and the reported footprint, but not the certificates.
• The CN code of each grade confirmed. A grade moved from 7214 to 7228 is assessed against a different default and different benchmarks. The credit file should know which applies to each EU sale.
• Who captures the saving, and the result at several certificate prices for 2026 to 2028, as the mark-up rises to 30%.

Next steps

1. Confirm the CN code of every bar you ship to the EU with your customs broker.
2. Pull one year of production records: billet per tonne of bar, DRI or pig iron per tonne of billet, pellets per tonne of DRI, and scrap per tonne of steel.
3. Run the calculator for 2026, 2027 and 2028 at three prices from the Commission's page, with your own ratios.
4. Ask each EU buyer which basis they will declare on and when they need your data for the 30 September declaration.
5. Read the CBAM hub for Egyptian exporters for the rules common to every product.

Frequently asked questions

What is the CBAM default for Egyptian steel rebar?

Egypt has no line of its own for rebar, so the figure for countries without their own entry applies: 3.996 tCO2e per tonne for CN 7214 20 00 and heading 7213, before the mark-up. Alloy bars under 7228 30 are 5.400.

Why does the default deduction for rebar use the blast furnace benchmark?

Because the default table marks rebar with route (C), carbon steel from blast furnace and basic oxygen furnace, and 2025/2620 says the deduction on the default follows the route given in that table. The benchmark is 1.364 tCO2e per tonne, whatever route the mill uses.

How many CBAM certificates does a tonne of Egyptian rebar need on the default?

About 3.07 in 2026, 3.50 in 2027, 3.97 in 2028 and 5.19 from 2034, with the correction factor at 100%. Multiply by the certificate price you take from the Commission's page.

Does a DRI or scrap-based mill get a smaller deduction on actual data?

Yes. On actual data the deduction is built from the mill's own chain: 0.038 for rolling, 0.065 for the billet on an electric arc furnace, 0.295 for each tonne of DRI and 0.086 for each tonne of pellets, scaled by the tonnes consumed. It is much smaller than 1.364, but actual data also replaces the 3.996 default with the mill's verified figure. In the example on this page actual data still costs far less; run the calculator with your own figures.

Do indirect emissions count for rebar?

No. Only direct emissions count for iron and steel under the current rules, so electricity used by the furnace does not add to the certificate count.

Does moving a bar from 7214 to 7228 take it out of CBAM?

No. Both headings are in scope. The CN code changes the default, from 3.996 to 5.400, and the benchmarks used for the deduction.

Send me what you received

If your EU buyer, a verifier or your lender has sent you a CBAM request about rebar or steel bars, send it to me in five short lines: what you received, from whom, the deadline, your sector, and what you want to know. I'll reply by email.

Send me what you receivedHow engagements run

Guides, checks, toolkit and newsletter are free. Advisory is paid work in a personal capacity: scope agreed in writing, fee quoted after a free first call.

I don't arrange finance, introduce lenders or work on files for my employer's credit decisions. Every enquiry gets a conflicts check before any work.

Sources

Legal texts (Official Journal of the European Union)

1. Regulation (EU) 2023/956 establishing a carbon border adjustment mechanism, Articles 6, 8, 10, 20, 21, 22 and Annexes I, II and VI eur-lex.europa.eu
2. Regulation (EU) 2025/2083 amending Regulation (EU) 2023/956 eur-lex.europa.eu
3. Commission Implementing Regulation (EU) 2025/2621 on CBAM defaults, Article 1 and Annexes I and IV eur-lex.europa.eu
4. Commission Implementing Regulation (EU) 2026/1740 of 20 July 2026 correcting Annexes I and IV of 2025/2621 (route indicators, mark-up rule) eur-lex.europa.eu
5. Commission Implementing Regulation (EU) 2025/2620 on the free allocation adjustment and CBAM benchmarks, Articles 1 to 4, recitals 5, 10 and 16, and Annex, points 2 to 5 eur-lex.europa.eu
6. Commission Implementing Regulation (EU) 2025/2547 on the methods for calculating embedded emissions, Articles 4, 13 to 15, Annex I points 3.13 to 3.16, Annex II points E and F, Annex III point B and Annex IV point 2 eur-lex.europa.eu
7. Commission Implementing Decision (EU) 2026/1862 on the cross-sectoral correction factor for 2026 to 2030, Article 1 eur-lex.europa.eu
8. Directive (EU) 2023/959 amending Directive 2003/87/EC, Article 10a(1a), CBAM factor eur-lex.europa.eu

European Commission

9. CBAM legislation and guidance, with the Commission's Excel files of default figures (version of 6 August 2026) and benchmarks (6 February 2026), Guidance document 4 on the free allocation adjustment and Guidance document 5d on iron and steel (14 August 2026) taxation-customs.ec.europa.eu
10. Price of CBAM certificates taxation-customs.ec.europa.eu

Trade data

11. Eurostat Comext, DS-045409, reporter EU, partners Egypt and extra-EU, imports, CN 7213 10 00, 7214 20 00 and 7228 30 69, 2023 to 2025 (dataset updated 16 October 2026, queried 2 November 2026) ec.europa.eu

Reported, not law

12. EnterpriseAM, "It looks like we might get a break on the EU's carbon tax", 12 January 2026 enterpriseam.com

All views are my own, written in a personal capacity. They do not represent my employer or any other institution. This page explains public rules; it is not legal or tax advice for a specific shipment.

Cite this guide

Other CBAM pages

• CBAM for Egyptian exporters
• CBAM for Egyptian urea
• CBAM for Egyptian ammonia
• CBAM for Egyptian aluminium
• CBAM for Egyptian cement and clinker