Scrap aluminium plays a central role in Europe’s green transition. Recycling aluminium uses up to 95% less energy than producing primary aluminium from bauxite and reduces CO₂ emissions by around 90%, making reliable scrap access crucial for climate-neutral production. However, market pressures have created growing leakage: US Section 232 tariffs on primary aluminium doubled to 50%, while scrap was exempted, incentivising exports to the US. At the same time, strong demand from Asian markets has further drained domestic scrap availability. As a result, roughly 15% of EU recycling furnace capacity currently sits idle, threatening production continuity and discouraging investment in new recycling infrastructure.

The Commission’s forthcoming policy aims to strike a balance between maintaining open trade and ensuring European industries can access sufficient scrap at competitive prices. The goal is to strengthen Europe’s industrial resilience while supporting the EU’s climate neutrality targets and circular economy ambitions.

Paul Voss, Director General of European Aluminium, commented: “This is a decisive and timely initiative. Securing access to critical raw materials like aluminium scrap is essential for Europe’s economy, its industrial competitiveness, and its ability to achieve climate and circularity objectives.”

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Aluminium’s Key Role in Green Transition

Aluminium is vital for lightweight transport, energy-efficient buildings, and renewables. European producers are investing to cut emissions, but CBAM in its current form may unfairly penalize them while benefiting importers.

Scrap Content Loophole Risks Abuse

Scrap aluminium is assigned zero emissions under CBAM, allowing importers to over-declare scrap content and avoid fees. This could give foreign producers a 3.6–6.5% price advantage over European makers.

Alumina Inclusion Could Raise Costs

Including alumina in CBAM could increase raw material costs by up to 24% by 2034, harming European smelters and downstream industries. Experts recommend delaying its inclusion until a more balanced system is in place.

Indirect Emissions Pose Further Threats

Adding indirect emissions would raise costs and prices, reduce demand, and create unfair competition, as EU producers already face high electricity carbon costs not matched by global rivals.

Call to Pause CBAM Implementation

With over one million European jobs at stake, the aluminium sector urges a pause in CBAM for aluminium until these issues are fixed to protect industry competitiveness and climate goals.

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