This newsletter was published 8.1.2024 at 17:02pm CEST

The current prices on the European carbon market are as follows:

In 2024, EUAs traded in a calm manner; however, the yearly range was quite significant. Just before the start of the year, EUAs were trading slightly above 80 EUR per tonne. Bearish sentiment, combined with increased primary auction supply, caused a sharp decline, with prices falling almost daily till the end of January, before finding support just above 60 EUR per EUA. This level held for only two weeks and, despite substantial net short positions, could not sustain due to immense selling pressure. Carbon continued to trend lower before finally bottoming out at 51.08 EUR per EUA for the December 2024 futures contract, which marked the yearly low. Interestingly, the market bottomed on what many would consider a bearish news—the release of verified 2023 emissions data, which indicated even lower emissions that initially anticipated. These events occurred in late February 2024. However, the market did not exhibit a classical V-shaped recovery but instead began to slowly grind upward. The upward movement in EUAs was consistently supported by rising gas prices, as TTF pricing started closely tracking liquefied natural gas prices. In some sense, gas prices have become a more globalized commodity, with fundamental factors from around the globe playing a more significant role in pricing than ever before. The reversal in EUAs to the yearly highs was slow but steady. Investment funds began to take profits from their short positions, but the substantial size of these positions required time to be fully covered through buying activity. The market maintained its bullish trend until the end of May, when the December 2024 futures contract peaked at 78.10 EUR per tonne. What followed for the remainder of the year was mostly uneventful, characterized by range-bound trading. Buyers stepped in more aggressively when prices approached 60 EUR per tonne, while sellers showed strength at 66 EUR and around 70 EUR per EUA. Carbon ended 2024 at roughly the same level where it started. On the first trading day of 2024, spot EUAs settled at 73.17 EUR, while prices closed at 70.95 EUR on the last trading day of the year. The busiest trading day for EUAs in 2024 was October 7, with daily volume exceeding 61 million tonnes—2.18 times the average daily volume of just over 28 million tonnes.

German power prices are up by 0.99 EUR since last week, with the front-year contract trading at 89.80 EUR/MWh. API2 coal prices are down by 6.15 USD since last week, with the Cal-26 contract trading at 109.00 USD/tonne. Front-year gas prices are down by 1.085 EUR since last week, with the TTF Cal-26 trading at 38.385 EUR/MWh. EUR/USD is down by 60 points since last week and is currently trading at 1.0300.

Price development of EUA Dec2025 futures contract