European Wood and Flooring Industries Call for Changes to CBAM Rules on Key Raw Materials
European wood, furniture, parquet and flooring industries are calling on EU policymakers to reconsider how the Carbon Border Adjustment Mechanism, or CBAM, applies to key industrial raw materials used across wood-based manufacturing.
On September 9, six European industry organisations issued a joint position calling for a more proportionate application of CBAM. The signatories include the European Panel Federation (EPF), CEI-Bois, the European Furniture Industries Confederation (EFIC), the European Parquet Federation (FEP), the International Committee of Decorative Laminates Industry (ICDLI) and the Association of the European Producers of Laminate Flooring (EPLF).
While the organisations support CBAM's objective of preventing carbon leakage and creating a level playing field, they argue that its application to essential industrial inputs such as urea — and any future inclusion of methanol — could create unintended costs for European manufacturers.
Why Urea and Methanol Matter to the Wood Industry
The debate may appear to concern chemicals rather than wood products, but both materials are closely connected to the production of resins and adhesives used throughout the wood-based panel industry.
Technical-grade urea is an important raw material for amino resins used to bond wood particles and fibres in products such as particleboard and MDF. Methanol is also important further upstream in the production of formaldehyde and related resin systems.
These panels are widely used in furniture, interior construction and other downstream wood products. Changes in the cost of resin production can therefore move through the supply chain and eventually affect manufacturers, distributors and construction businesses.
Industry Groups Warn of Limited Alternatives
A central argument in the joint position is that European manufacturers currently have limited ability to avoid these additional costs.
According to the organisations, there are no technically and economically viable alternatives available at sufficient industrial scale for these essential inputs. European production is also not sufficient to satisfy overall regional demand.
As a result, manufacturers cannot simply replace imported materials with EU-produced alternatives when CBAM-related costs increase.
The industry groups argue that this creates a situation in which European manufacturers face higher input costs without gaining a realistic pathway to substitute the affected materials.
CBAM Entered Its Definitive Period in 2026
The Carbon Border Adjustment Mechanism moved into its definitive phase on January 1, 2026. The mechanism places carbon-related obligations on imports of certain carbon-intensive goods entering the European Union.
During the earlier transitional period, importers were primarily required to report embedded emissions. The definitive system introduces financial obligations linked to those emissions through CBAM certificates.
The European Commission has continued to issue implementation guidance during 2026, including updated information for importers, third-country operators and accredited verifiers.
For industries dependent on imported CBAM-covered inputs, the transition means carbon costs are becoming an increasingly tangible part of procurement and manufacturing economics.
Concerns Over European Manufacturing Competitiveness
The six associations warn that higher costs for essential inputs could weaken the competitiveness of European wood-based manufacturing.
Their concern is particularly focused on the relationship between imported raw materials and finished products. If a European manufacturer pays additional carbon-related costs on an imported industrial input while certain finished products manufactured outside the EU do not face equivalent costs throughout their supply chain, the competitive effect may become uneven.
This issue extends beyond panel manufacturers. Furniture producers, flooring businesses and other downstream industries can all be affected when the cost of panels, adhesives or related materials increases.
What the Industry Is Asking For
The joint position calls for urea to be excluded from CBAM and argues that methanol should also remain outside the mechanism.
The associations are also calling for an effective safeguard mechanism under Article 27a that could respond to severe or unforeseen market disruptions.
In addition, they want policymakers to conduct a detailed assessment of downstream effects before extending CBAM to additional chemical products.
Their position is not a rejection of the EU's carbon objectives. Instead, the organisations argue that climate measures should be designed in a way that avoids shifting production disadvantages onto European industries already investing in circularity and bio-based manufacturing.
What This Means for the Flooring Sector
The direct impact varies across flooring categories and manufacturing structures, but the debate is relevant to the wider European flooring supply chain.
Wood flooring production depends on a network of upstream materials that can include wood-based cores, backing materials, adhesives, coatings and packaging. Engineered flooring manufacturers in particular need to monitor not only timber prices but also changes in the cost and availability of other manufacturing inputs.
For importers and distributors, higher European production costs can influence sourcing strategies and product pricing. For manufacturers, the development reinforces the importance of understanding the regulatory exposure of materials throughout the supply chain.
Climate Policy and Industrial Strategy Are Converging
The CBAM debate highlights a broader challenge facing European manufacturing: how to pursue ambitious climate targets while maintaining competitive industrial production.
Wood-based industries frequently position themselves within Europe's circular bioeconomy because wood products can use renewable raw materials, recovered wood and increasingly efficient manufacturing processes.
The industry's current appeal therefore reflects a wider discussion about whether environmental regulation, trade policy and industrial competitiveness can be aligned without creating unintended pressure on downstream European manufacturers.
Industry Outlook
The final treatment of these industrial inputs will remain important for European panel, furniture, parquet and flooring manufacturers as CBAM implementation develops.
For businesses across the wood-products supply chain, the issue also demonstrates that future competitiveness will increasingly depend on more than timber sourcing alone. Carbon regulation, chemical inputs, adhesives, energy costs and supply-chain documentation are becoming interconnected parts of manufacturing strategy.
The September joint statement sends a clear message from the sector: European wood industries support decarbonisation, but they want carbon policy to recognise the practical realities of industrial supply chains.
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Summary
Six European wood, furniture, parquet and flooring organisations are calling for a more balanced application of the EU Carbon Border Adjustment Mechanism. The industry wants urea excluded from CBAM and methanol kept outside its scope, warning that limited European supply and a lack of viable alternatives could increase manufacturing costs and weaken the competitiveness of European wood-based industries.
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