Emerging opportunities and enabling levers Harmonized definitions and verification Swift convergence on near-zero and low-emissions thresholds, embodied in clearly auditable cradle- to-gate metrics aligned with IEA’s measurement guidance, would unlock cross-border recognition and simplify contracting.112 Procurement-led markets Procurement can create price-discoverable segments where green premiums can be observed, benchmarked and gradually competed down.113 The EU is exploring non-price procurement criteria to value low-emissions attributes in public purchases, while Germany’s LESS aims to provide a universal standard for transparent segmentation of low-emissions steel. Sequenced CBAM and ETS incentives With CBAM’s definitive phase starting in 2026 and ETS’s free allowances phasing out up to 2034, policy in Europe provides a time-bound business case: the cost of unabated routes will rise while verified low- emissions routes gain relative advantage. Suppliers are preparing by locking in offtakes and calibrating investment timing to this arc.114 Policy in Europe provides a time-bound business case: the cost of unabated routes will rise while verified low-emissions routes gain relative advantage. Value chain risk-sharing Innovative contracts, flexible volume offtakes, pay-for-attribute certificates alongside physical shipments and multi-buyer coalitions help spread risk and accelerate FIDs. Early market testing campaigns show that limited volumes can command partial premium recovery and provide learning for both sides. Geography-smart siting Suppliers emphasized the importance of multi-site portfolios close to demand centres and advantaged resources (e.g. access to affordable power), rather than single mega-sites. This reflects some of the technology innovations attempt to offer flexible modular upgrades.Near-term pathways that bank scope 3 gains Several strategies (e.g. high-quality scrap programmes, low-carbon raw material sourcing, renewable fuels in logistics) are already lowering embodied emissions and are financeable today. One producer noted that coupling the use of biocarbon in steel production and utilization of renewable fuels in shipping could deliver market-ready low-emissions grades at meaningful (if limited) volumes. Market protection paired with downstream alignment Suppliers consistently argued that tariff-rate quotas or CBAM-like mechanisms must account not only for primary steel but also for downstream products, to keep pricing signals intact across the chain. You need to protect the whole value chain… up through the end use. Fernando Pessanha, Chief Strategy Officer, Hydnum Steel Strategic recommendations Adopt common standards to make environmental attributes bankable Suppliers recommended that governments, buyers and producers converge on near-zero and low-emissions steel definitions, agree common accounting rules and couple these with a single verification passport that travels with the steel coil/plate across borders. This could help reduce transaction costs and turn environmental attributes into bankable collateral for lenders.115 Make demand signals investable Proposals already in place across public and private sectors need strengthening. –Public procurement: Governments can introduce mandatory non-price sustainability criteria for steel-containing public projects above a threshold value, phased by product class, with auditable emissions benchmarks mirroring the EU’s emerging direction and Germany’s LESS concept.116 Turning Challenge into Opportunity: Supplier Voices from Heavy-Emitting Sectors 37

Turning Challenge into Opportunity 2025