China Carbon Market Weekly Update – 18 September 2023

Week at a glance (September 11 – September 15, 2023)

  • Activity in China’s national Carbon Emissions Allowance (CEA) market dropped nearly 60% from the 2023 high set in the previous week, closing the week with 5.9 million tons of total volume. Block trades accounted for all of the decrease. At the same time, however, open transactions increased substantially. Among the 5.9 million tons of weekly total volume, 0.7 million came from the 2019-2020 vintage, 2.6 million from the 2021 vintage, and 2.6 million from the 2022 vintage. The 2021 vintage saw the biggest decline in volume among the three vintages.
  • Every market price indicator climbed to its all-time high during the week, despite the steep drop in total volume. The closing price of open market transactions for the week was 74.76 yuan ($10.41) per ton, 3.5% higher than the previous week. The volume-weighted average price for all of the week’s trades was 70.65 yuan ($9.84) per ton, breaking the 70-yuan mark for the first time.
  • All three allowance vintages closed the week at their weekly closing and average highs since vintage-based trading began three weeks before.  The oldest allowances, the 2019-20 vintage, continued to command the highest prices among the three vintages, ending the week with a closing price of 75.53 yuan per ton for open market transactions—the highest closing price ever for any vintage—and a volume-weighted average price of 73.79 yuan per ton for all trades. The newest 2022 vintage, on the other hand, has shown the least price and volume fluctuations over the three weeks.
  • Activity across the nine regional China Certified Emission Reductions (CCER) markets rose to 175,100 tons of combined volume. Beijing led the markets, accounting for 87% of their combined volume. Meaningful CCER price information was available from Beijing and Sichuan. Beijing was able to maintain a sizable CCER price premium while Sichuan slipped to a sizable discount as the prices of all CEA vintages kept climbing toward new highs.
Share this report