Ukrainian industry associations have warned of extremely negative consequences of the introduction of the European Carbon Border Adjustment Mechanism (CBAM) for Ukraine’s economy and industrial sector.
This was stated in an appeal by trade unions addressed to the Ambassador of the European Union to Ukraine, Katarína Mathernová.
In their appeal, trade union representatives called for the introduction of a transitional period and support mechanisms for Ukraine due to the risks of export losses, job cuts, and a decline in GDP.
The Trade Union of Workers of the Metallurgical and Mining Industry of Ukraine emphasized that for Ukraine, which is in its fourth year of resisting Russia’s full-scale aggression, the application of CBAM on standard terms could become a “devastating blow.”
“Ukrainian industry is operating under conditions of active hostilities, disrupted supply chains, and an acute labor shortage, while the mining and metallurgical complex has lost around 40% of its capacity due to the war,” the union stated.
According to forecasts by the National Mining Association of Ukraine, already in the first year of full CBAM implementation, losses to the national economy could exceed $200 million.
The Federation of Metallurgists of Ukraine warned of the risk of a systemic decline of the mining and metallurgical sector, mass layoffs, and rising social tension in frontline regions.
The trade unions also cited practical consequences of the mechanism’s implementation. In particular, ArcelorMittal Kryvyi Rih announced a forced shutdown of the blooming mill at its rolling department in the second quarter. According to Nataliia Maryniuk, head of the company’s primary trade union organization, the key factor was the European Commission’s decision to introduce CBAM from January 1, 2026, without taking into account Ukraine’s wartime and economic realities.
According to the company’s estimates, additional costs for access to the EU market will amount to $60–90 per ton, making the products uncompetitive. As a result, European customers have already suspended all orders, and the company has lost 1.25 million tons of exports planned for 2026.
If no preferential or transitional period is introduced, the shutdown of a blast furnace, a reduction in downstream processing capacity, and placing part of the workforce on idle time are possible.
The trade union noted that the European Commission did not take into account Ukraine’s arguments regarding the application of Article 30.7 of CBAM Regulation (EU) 2023/956, which allows for adjustments or deferral of the mechanism for countries affected by exceptional and unprovoked events that have caused serious damage to the economy and infrastructure.
The trade unions propose that the EU soften the implementation of CBAM for Ukraine, including extending the transitional period, introducing special support instruments, creating financial assistance and industrial modernization funds, and involving representatives of labor collectives in dialogue on the practical implementation of the mechanism.
The initiative was supported by the Federation of Trade Unions of Ukraine, as well as unions representing the coal, chemical, energy, building materials, and agro-industrial sectors.
