China Carbon Market Weekly Update – 8 April 2024

Week at a Glance (April 1, 2024 – April 5, 2024)

• China's national Carbon Emissions Allowance (CEA) market was quiet during the holiday-shortened 3-day trading week, with a total weekly volume of 165 thousand tonnes. Block trades were absent. Among the weekly total volume, 80 thousand tonnes came from the 2019-2020 vintage while 85 thousand tonnes were from the 2022 vintage. The 2021 vintage saw no trades.
• CEA prices retreated from the all-time highs set during the previous week but remained near them. The volume-weighted average price of all of the week’s trades dropped 1.9% from the previous week to 87.15 yuan (US$12.28) per tonne, but still marked the second highest closing price of all time.
• Activity across the nine regional China Certified Emission Reductions (CCER) slowed to only 3,754 tonnes. Only Sichuan and Beijing saw trades, with the former accounting for nearly all their combined volume. Available prices continued to be significantly lower than their CEA counterparts.

Carbon Market Update (April 1, 2024 – April 5, 2024)

China's national Carbon Emissions Allowance (CEA) market was quiet during the holiday-shortened 3-day trading week, with a total weekly volume of 165 thousand tonnes. Block trades were absent.

Among the weekly total volume, 80 thousand tonnes came from the 2019-2020 vintage while 85 thousand tonnes came from the 2022 vintage. The 2021 vintage saw no trades.

Prices retreated from the all-time highs set during the previous week but remained near them. Open market transactions finished the week at 87.00 yuan (US$12.26) per tonne,[1] decreasing 4.4% from the previous week but nonetheless registering the second highest closing price of all time. The volume-weighted average price of all of the week’s trades dropped 1.9% from the previous week to 87.15 yuan (US$12.28) per tonne, also the second highest closing price of all time. The two traded CEA vintages also retreated from their all-time highs set during the previous week.

Activity across the nine regional China Certified Emission Reductions (CCER) slowed to only 3,754 tonnes. Only Sichuan and Beijing saw trades, with the former accounting for nearly all their combined volume. Available prices continued remaining vastly lower than their CEA counterparts.

[1] Starting with the 26 February 2024 issue, this newsletter calculates our own daily overall market closing price using the volume-weighted average of traded CEA vintages. This replaces the closing price reported by the Shanghai Environment and Energy Exchange (SEEE), which is an equal-weighted average of the closing prices of all three CEA vintages. The closing price reported by the SEEE does not reflect market reality due to the frequent and vast volume differences among the vintages on any given day.

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1 US$ = 7.0949 RMB, middle price, April 3, 2024, China State Administration of Foreign Exchange. The same exchange rate is used for all other values quoted in US dollars ($) in the newsletter.

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