Fastmarkets launched a calculated benchmark for potential carbon-border costs on primary aluminium imported into Europe on 3 November 2026, with the assessment scheduled for publication twice a week. The new reference comes as European billet-to-ingot premiums have narrowed below estimated conversion costs, adding pressure on processors.
The commodity price reporting agency designated the assessment MB-AL-0441. It covers P1020A aluminium ingot with a minimum purity of 99.7% and is intended to give traders and industrial buyers a common reference for carbon-related import costs and the financial impact of European Union carbon regulations.
Fastmarkets estimates potential CBAM costs using country-specific default emissions values, adjustments linked to applicable EU benchmarks and a carbon-certificate price index. The methodology uses a volume-weighted average of default emissions values for countries accounting for at least 75% of EU aluminium ingot imports; Fastmarkets reviews the import composition behind the assessment every six months.
The indicative cost is calculated by multiplying adjusted default emissions values by Fastmarkets’ CBAM certificate price index, which draws on EU carbon-market data. The agency said its methodology could evolve to include verified emissions information and future regulatory changes.
The assessment is a market reference, not a calculation of an individual importer’s final regulatory liability. Importers and traders still need installation-specific documentation and regulatory calculations to establish their actual CBAM obligations.
Import costs and emissions data
The EU’s CBAM regime increasingly links import competitiveness to the emissions intensity of industrial production. European buyers comparing imported primary aluminium with output from EU smelters and suppliers using lower-carbon electricity need to consider emissions intensity, carbon pricing and the availability of verified installation-level data.
That information may also matter in commercial negotiations for producers in the Western Balkans and other non-EU European markets. Electricity procurement, production efficiency and verified emissions documentation may affect the commercial attractiveness of aluminium supplied to European industrial customers.
The benchmark does not itself impose additional costs or change CBAM regulation. Its importance will depend on whether market participants use it in procurement negotiations, forward pricing and contractual risk management.
Billet premiums fall below conversion costs
Fastmarkets’ market figures put the spread between North German 6063 extrusion billet and duty-paid P1020A aluminium in Rotterdam at approximately 247 euros per tonne on 28 October, equivalent to 276.25 dollars per tonne. The spread was 58.2% below its 7 August peak of approximately 591 euros per tonne, equivalent to 661.25 dollars per tonne.
The spread had fallen below estimated billet conversion costs of approximately 268–313 euros per tonne. The contraction came as billet premiums weakened while primary aluminium premiums firmed, reducing the additional revenue available to processors converting ingot into semi-finished products.
For extrusion and billet manufacturers, the narrower product premium makes it harder to recover energy, labour, conversion and carbon-related costs. European aluminium processors are also facing pressure from energy costs and declining billet premiums, with carbon-cost transparency emerging as another competitiveness factor.
Together, the new CBAM reference and shrinking conversion margins reflect changes in European aluminium procurement and processing. Buyers increasingly need to assess metal prices alongside emissions evidence, carbon-regulation costs and exposure to changing premiums.
