24 November 2014: A recently released report, titled ‘Turning over a New Leaf: State of Forest Carbon Markets 2014’ and published by the Ecosystem Marketplace, reveals that the cumulative value of the forest carbon market has now exceeded US$1 billion thanks to a 17% increase in carbon transactions between 2012 and 2013.

Despite the increase in carbon traded, however, the report notes that the total value of forest carbon transactions has decreased due to a drop in average carbon prices. Individual forest carbon prices vary drastically according to the report, ranging from US$1 per ton of carbon dioxide equivalent (tCO2e) on the Chicago Climate Exchange, to US$100/tCO2e on the domestic carbon offset market in Japan.

With regard to purchasers of forest carbon, the report lists voluntary buyers as the most significant group, including energy utilities and food and beverage companies, a majority of which are based in Europe.

The report notes that deforestation and land-use change still account for 14% of greenhouse gas (GHG) emissions. With regard to forest carbon projects, a majority are REDD+ projects, largely from Latin America. In addition to carbon benefits, the report states that REDD+ projects often deliver significant additional benefits for biodiversity, livelihoods, education and health. In fact, the report values 2013 multiple benefits for education, health and infrastructure at US$41 million while 9,000 jobs were created and 13 million hectares of land were protected.

The report concludes that “the cost estimates of what is needed to stop deforestation and reduce land-use emissions far outweighs the current capacity of the forest carbon markets.” It notes that this imbalance between demand to purchase carbon and supply in forest carbon markets could be partially addressed through further commitments towards the achievement of the New York Declaration on Forests, as well as progress through the UN Framework Convention on Climate Change (UNFCCC) negotiations, especially dialogues on REDD+. [Ecosystem Marketplace Press Release] [Publication: Turning over a New Leaf: State of Forest Carbon Markets 2014]