Tata Steel Europe Adds EUR12 Carbon Surcharge
Argus reported that Tata Steel Europe is introducing a EUR 12 per tonne carbon surcharge for all new steel contracts in the UK and Europe with immediate effect. The surcharge is designed to help the company buy the future carbon emissions allowances it will need. Prompt emissions allowance costs have increased dramatically over the past year, from a low of EUR 15.47 per tonne on 23 March 2020 to EUR 43.56 per tonne on 9 April 2021 The surcharge comes amid a current tightness in the steel market and rising coil prices since the last northern hemisphere summer. Some buyers have already accepted the surcharge, although they have little choice given the lack of alternatives in the marketplace. Other steel mills are likely to follow suit and are currently in discussions with their customers.
Tata Steel Europe's emissions per tonne of crude steel were 1.98 in 2019-20, according to its annual report, with the current cost of its emissions close to the surcharge level.