Southeast European cement and fertiliser producers can face substantial CBAM exposure through materials manufactured outside their own facilities. For cement grinding plants and fertiliser blending businesses, the emissions associated with upstream inputs can be more significant than those generated during local processing, making supplier data and sourcing decisions central to the information provided to EU customers.
Although both sectors depend heavily on upstream materials, their emissions calculations involve different production boundaries and monitoring requirements. Cement assessments must account for clinker, finished-product composition and processing activities. Fertiliser calculations depend on chemical precursors, nitrogen content and the specific manufacturing route. A generic approach designed for steel or aluminium would not capture these sector-specific requirements.
Clinker composition shapes cement emissions
The European Commission’s sector guidance addresses the role of clinker and the composition-based calculation used for cement. A grinding plant purchasing clinker must establish its source, obtain the applicable emissions information and account for the relevant emissions from its own processing activities.
Clinker content is therefore a key parameter in cement emissions reporting and procurement. A grinding business considering a different clinker share must evaluate the potential emissions effect alongside product composition, strength requirements and customer specifications. Reducing the clinker ratio can offer advantages only if the resulting cement remains suitable for its intended use and the availability of alternative constituents is reliable.
Producers should not base commercial claims solely on a lower calculated carbon intensity without confirming that the finished product meets the required technical criteria.
Material traceability is equally important. A plant may receive clinker from several production installations, keep it in storage and allocate it across different cement products. Its calculation needs to establish a defensible relationship between the sources, quantities consumed and resulting output. Annual purchase totals alone may not accurately represent the input mix used during the relevant reporting period.
This can create a verification challenge for grinding businesses. Records for local electricity and fuel consumption may be readily available, while the upstream clinker emissions report remains difficult to obtain. The risk is particularly relevant when purchases are made through traders rather than directly from producing installations.
Supply agreements should address the availability of the necessary evidence, and any change of source should trigger a review of both documentation and technical quality requirements.
Fertiliser calculations depend on chemical production routes
Fertiliser manufacturers face a different pattern of upstream dependencies. The Commission’s guidance identifies chemical precursors such as ammonia and addresses indirect electricity emissions where applicable. Nitric acid production also requires specific monitoring of nitrous oxide (N₂O), using the relevant measurement approach.
The production route must therefore be mapped before the operator can establish which information is needed for the calculation.
A fertiliser blending facility purchasing chemicals may generate relatively limited emissions at its own site while depending on several upstream production records. Management needs to identify the covered inputs and determine how their quantities and relevant characteristics contribute to the finished product’s calculated emissions.
A supplier’s general sustainability report may provide useful background, but it may not contain the product-specific or installation-specific evidence required for the calculation.
Product composition also matters when emissions figures are communicated to customers. Comparisons between fertilisers should use consistent product definitions and the applicable units. A figure expressed per tonne of commercial product should not be compared indiscriminately with one based on a different functional unit or composition.
Manufacturers should state clearly what each reported intensity represents and maintain that definition across their documentation and customer communications.
Electricity and precursor emissions require separate assessment
Electricity has a different role in these sectors from the current direct-emissions-only treatment applicable to Annex II metal goods. Cement and fertiliser producers must examine electricity consumption and the relevant calculation factors under the rules governing their products.
Businesses considering renewable electricity arrangements should verify whether the arrangements satisfy the applicable requirements for the intended emissions treatment. A general claim that electricity is renewable does not, on its own, establish the result under the relevant methodology.
Energy procurement and precursor sourcing should also be assessed together. A cement plant may improve its electricity supply while remaining heavily exposed to a high-emissions clinker source. A fertiliser blender may reduce energy use at its own facility while emissions from purchased chemicals continue to dominate its product calculation.
Investment decisions should compare the contribution of each source of emissions to identify where the largest feasible reduction lies. Upstream improvements may offer the greatest impact, even when local energy-efficiency measures remain financially worthwhile.
Inventory and logistics influence the sourcing decision
Seasonal procurement and stock management can affect the reliability of emissions records. Producers may buy materials ahead of expected demand or maintain buffer inventories to protect against supply interruptions. Reporting teams must distinguish between quantities purchased during a period and quantities actually consumed in production.
This distinction supports a more reliable calculation and helps explain differences between cash purchasing expenditure and the material costs attributed to current production.
Transport, storage and financing costs must also be included when comparing alternative suppliers. Switching the source of clinker or ammonia can change freight expenditure, warehousing requirements and working-capital needs, even where those costs do not form part of the relevant embedded-emissions boundary.
The commercial sourcing model and the regulatory calculation should therefore remain consistent with one another while retaining a clear distinction between financial costs and emissions included under CBAM.
Practical controls can address the largest evidence gaps
Smaller cement and fertiliser producers can begin by focusing on a limited number of critical inputs rather than investing immediately in extensive automation. A precursor register, supplier documentation schedule and reconciliation of consumption against production can help identify and address the most important information gaps.
Additional meters and monitoring controls should be prioritised where they improve the reliability of a parameter required by the applicable calculation. Investment should respond to a defined monitoring need rather than simply increase the amount of equipment installed.
Producers must also distinguish between a reduction in reported emissions intensity and the resulting change in their final CBAM certificate requirement. The applicable certificate calculation and adjustments need to be assessed separately; a percentage reduction in reported intensity does not necessarily produce an equivalent percentage reduction in the final cost.
EU customers may value lower reported intensity for commercial or environmental reasons, but financing decisions should be based on the expected cost effect under the applicable rules rather than an assumed proportional relationship.
For Southeast European cement and fertiliser exporters, procurement decisions can determine a substantial part of the final export position. The most useful comparison is between complete supply routes that provide both a technically acceptable product and the documentation needed to support its emissions calculation. Efficient grinding and blending operations cannot replace missing production data for the materials they receive.
