Kazakhstan could face more than €100 million in annual carbon-related costs on steel and aluminium exports to the European Union if exporters rely on default emissions values rather than verified production data, according to an EU-supported assessment presented in Astana in June 2026.
The International Trade Centre (ITC) and Kazakhstan’s trade development agency QazTrade presented their CBAM readiness assessment on 9 June 2026. The report examined Kazakhstan’s aluminium, iron and steel industries and outlined a phased approach to improving emissions reporting, verification capacity and industrial competitiveness.
The assessment estimated that Kazakhstan exports more than €600 million worth of steel and aluminium products to the EU. Under the report’s assumptions, the use of CBAM default values could generate more than €100 million in annual carbon-related costs, with approximately 90% of the estimated exposure concentrated in steel bars and rods.
These figures represent modelled risks under the assessment’s assumptions, rather than verified CBAM payments made during 2026.
Steel bars and rods account for most projected exposure
The assessment highlights substantial differences in potential CBAM exposure across individual industrial products. Kazakhstan’s metals industry is integrated into European supply chains, making the treatment of embedded emissions commercially significant for exporters seeking to maintain access to EU customers.
The concentration of projected costs in steel bars and rods demonstrates how product composition can influence a country’s overall exposure to the carbon border mechanism. The emissions values applied to individual products can affect the estimated carbon liability, particularly when exporters cannot substantiate actual installation-level emissions.
For steel manufacturers, reliable information about production routes and precursor materials is especially important. Conventional blast-furnace production and alternative steelmaking technologies can have materially different emissions profiles, while incomplete documentation may prevent producers from demonstrating their actual performance under the applicable CBAM rules.
EU trade concentration raises the importance of emissions verification
The assessment identifies the European Union as one of Kazakhstan’s leading trading partners, accounting for approximately 44% of the country’s exports. More than half of Kazakhstan’s aluminium exports are destined for EU member states, according to the report.
This concentration increases the commercial importance of maintaining access to European buyers as emissions reporting and verification requirements become more significant in industrial trade.
The implications extend beyond immediate compliance costs. Kazakhstan is seeking to strengthen its position in international industrial supply chains, including those linked to the Trans-Caspian transport corridor. Carbon-related requirements may increasingly influence sourcing decisions by European companies considering long-term supply arrangements with Central Asian producers.
Verified emissions data and cleaner production identified as priorities
The assessment proposes several measures to reduce potential CBAM exposure, including replacing default values with verified actual emissions data, strengthening industrial emissions monitoring, expanding verification capacity and investing in cleaner production processes.
For steel and aluminium producers, these measures could help establish whether the emissions associated with individual facilities differ from the applicable default assumptions. Effective monitoring and documentation would also support more accurate assessments of embedded emissions across production routes and upstream materials.
The ability to demonstrate actual emissions is therefore a central element of the proposed strategy. Without reliable data and appropriate verification, producers may remain dependent on default values even where their facilities perform differently from the relevant reference assumptions.
Industrial finance could support monitoring and modernisation
The findings identify potential financing needs for banks and development finance institutions, particularly in metering infrastructure, emissions reporting systems and plant modernisation.
Investments in these areas could help industrial companies build the technical capacity required to document emissions and support verification. Modernisation projects may also change production emissions, although the effect on CBAM liabilities depends on the emissions recognised under the applicable methodology.
The assessment also highlights a wider issue for emerging industrial exporters: inadequate emissions evidence can create significant commercial exposure in markets applying carbon border measures. For Kazakhstan’s metals industry, the projected costs underline the financial importance of establishing reliable monitoring and verification systems as part of its strategy for maintaining European market access.
