Isra-Mart srl : New Zealand spot carbon price flat, off highs

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Isra-Mart srl news:

New Zealand carbon prices inched higher over the previous week, but volume was weak as emitters were seen having largely met their 2010 needs and sellers held onto their units.

Spot permits under New Zealand's emissions trading scheme were seen trading at NZ$20.20 ($15.30), brokers said, compared with the previous week's price of NZ$20.10. The units hit a record above NZ$21 earlier this month, driven by strength in international carbon markets.

About 250,000 NZUs were traded over the week, according to brokers, the same as the week before but half the volume of earlier in the month.

Each permit represents a tonne of greenhouse gas emissions. The scheme is designed to help curb output of emissions blamed for causing global warming.

"The NZU market consolidated further this week -- spot volumes were very light and most of the trading activity was around $20.20," Nigel Brunel of OM Financial said in a note to clients.

The indicative value of the March 2012 forward contract was put at NZ$21.75.

The price for U.N carbon offsets closed at 13.08 euros (NZ$24.40) on Thursday.

The end of March marked the deadline for emitters to submit their 2010 emissions data to the government, with the corresponding permits to be surrendered by the end of May.

The New Zealand market, the only national emissions trading scheme outside the European Union, was initially marred by a lack of supply, but has been ramping up since mid 2010 when the scheme was expanded to include energy producers, industry and the transport sector, which account for about half of the country's emissions.

New supply of units hitting the market has been weak, OM's Brunel said, as sellers hold out in hope of seeing the higher prices of earlier this month, while strong log prices are encouraging foresters to harvest trees rather than sell the corresponding units.

On Thursday the New Zealand government set a target of a 50 percent reduction in 1990 carbon emissions by 2050, and said the scheme would play a key role in meeting the target.