China Carbon Monthly Market Update – April 2023

Monthly carbon market update (April 2023)

Trading in China’s national carbon emissions allowance (CEA) market totaled 1.05 million tons in April, a decrease of nearly 20% from March. Block trades accounted for 95% of April’s total volume.  There was not any noteworthy policy news during the month. While the formal passage of the European Union’s Carbon Border Adjustment Mechanism (CBAM) on the 25th grabbed the attention of many market participants, it understandably did not spark any real action in the CEA market. 

Price actions in the market reflected the lack of engagement, setting multi-month lows by multiple price gages. Open market transactions closed in April at 55.00 yuan ($7.94)[1] per ton, the lowest since December 2022. The lowest daily price for the month was 50.50 yuan per ton, the lowest since December 2021. The volume-weighted average price for block trades was 52.58 yuan ($7.59) per ton for April, its lowest since January 2022. The volume-weighted average price for all trades in April was 52.68 yuan ($7.60) per ton, a tad lower than in March while setting a 15-month low.

[1] 1 US$ = 6.9240 RMB, middle price, April 28, 2023, China State Administration of Foreign Exchange. The same exchange rate is used for all other values quoted in US dollars ($) in the article.

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