[SMM Nickel Midday Commentary] Nickel prices edged down on August 19, and the 10-year U.S. Treasury yield hit a record high.

US Ambassador Andrew Puzder argued in the Financial Times that the EU's criticism of US Section 232 steel tariffs as protectionist rings hollow given Brussels' own simultaneous trade barriers — both CBAM and tariffs ultimately raise costs for third-country imports. Since July 1, the EU has slashed duty-free steel quotas by approximately 47% to 18.35 million tonnes, with a 50% tariff above quota, while the Commission is already examining extensions to stainless steel wire, other wire products, cast pipes, and forged bars. The EU steel regulation's statistical basis is also under scrutiny: by selecting 2023–2025 as the reference period and excluding 2021–2022 as "unrepresentative," Brussels found a 15% import increase — but around 60% of that increase came from Turkey alone. Swiss steel deliveries fell 18.9% over the same period yet were deemed to meet the "increased imports" criterion, while Bosnia's similar decline led to the opposite conclusion.

The European Commission has published sector-specific CBAM guidance for iron and steel, providing detailed rules on calculating and monitoring embedded emissions during the definitive period from 2026. Steel imports are divided into six aggregated goods categories: sintered ore, ferro-alloys, pig iron, DRI, crude steel, and iron or steel products. Only direct emissions are generally included for steel products, with sintered ore (CN 2601 12 00) as the exception requiring indirect electricity emissions. For EAF-based steelmaking, electricity-related emissions are excluded from crude steel embedded emissions calculations. For stainless steel produced via the EAF/AOD route, embedded emissions are calculated at 1.783 mt CO₂/mt; a hypothetical 2027 import of 100mt of stainless steel results in an obligation to surrender 95.9 CBAM certificates after the free-allocation adjustment. Material losses from cutting and machining increase embedded emissions per tonne of finished goods, with stainless steel screws and nuts reaching 2.371 mt CO₂/mt. The guidance is explanatory rather than legally binding, with applicable EU legislation taking precedence.

Outokumpu has inaugurated a biocoke agglomeration plant in Tornio, Finland, substituting fossil coke with biomass-based alternatives in ferrochrome manufacturing to support its low-carbon stainless steel production targets. The EUR 30 million facility processes biochar into biocoke, reducing direct CO2 emissions by up to 82,000 tonnes per year — equivalent to the carbon footprint of 8,000 Finnish residents. Head of Outokumpu EvoCarbon Juha Erkkilä confirmed that production has commenced for both internal use and external customers. The project advances Outokumpu's strategy to lower value chain CO2 emissions by 42% by 2030 versus 2016 levels, with the company's ferrochrome production already carrying a carbon footprint 67% below the global industry average.