Market Overview

The Latin America Carbon Credit Market size reached USD 46.9 Billion in 2024, driven by legislative frameworks, net-zero pledges, and investments in nature-based solutions. The market is projected to grow at a CAGR of 33.2% between 2025 and 2033, reaching USD 823.8 Billion by 2033. Growth is fueled by rising corporate commitments, international trading systems, and increasing demand for certified offsets.

Study Assumption Years

  • Base Year: 2024
  • Historical Year/Period: 2019-2024
  • Forecast Year/Period: 2025-2033

Latin America Carbon Credit Market Key Takeaways

  • The market size reached USD 46.9 Billion in 2024 and is expected to grow to USD 823.8 Billion with a CAGR of 33.2% during 2025-2033.
  • There is a rising demand for long-term, large-scale carbon offset agreements focused on forestry and land restoration initiatives.
  • Investments in forestry programs support emission reduction, biodiversity conservation, and bolster local economies.
  • Financial institutions play a key role in facilitating carbon credit transactions aligned with global sustainability goals.
  • Major deals include Meta's 2024 agreement to purchase up to 3.9 million carbon offset credits from BTG Pactual’s forestry division through 2038.
  • BTG Pactual Timberland Investment Group committed to supplying Microsoft with up to 8 million nature-based carbon reduction credits by 2043, backed by a USD 1 Billion forestry program.

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Market Growth Factors

The Latin America carbon credit market moves due to regulations, corporate net-zero commitments, international carbon markets, rising deforestation and investments in nature-based solutions. Governments advance voluntary carbon markets and offsets for encouraging cost-effective emissions reductions, adding growth to the carbon market.

The demand for long-term nature-based carbon offset commitments is shaping the market's evolution and is leading to multi-year contracts for verified credits in forestry and land restoration projects that deliver climate benefits, preserve biodiversity, deliver economic and development benefits at local scales, and more recently, the more impact-oriented behavior of financial institutions.

The region has high potential to meet regulation-driven and voluntary demand for high-quality removal credits. The large-scale investment in high-quality projects such as BTG Pactual's USD 1 Billion forestry and natural restoration programs can provide long-term backing for financing and deploying projects to support nature-based carbon removal technologies.

Market Segmentation

Type Insights:

  • Compliance: The market includes compliance-based carbon credits driven by government regulations.
  • Voluntary: Voluntary carbon credits fueled by corporate sustainability pledges and market demand are significant.

Project Type Insights:

  • Avoidance/Reduction Projects: Projects preventing emissions contribute to the market.
  • Removal/Sequestration Projects: These include nature-based and technology-based initiatives aimed at capturing and storing carbon.

End-Use Insights:

  • Power: Carbon credits used in the power sector for emission offsetting.
  • Energy: Energy sector utilization for carbon offset requirements.
  • Aviation: Credits used by the aviation sector to meet emission targets.
  • Transportation: Transportation sector participation in offsetting emissions.
  • Buildings: Credits purchased to offset emissions in building operations.
  • Industrial: Industrial sector usage of carbon credits.
  • Others: Other sectors engaging in carbon offsetting.

Regional Insights

Brazil, Mexico, Argentina, Columbia, Chile, Peru, and other Latin American countries are key regional markets. The growth is underpinned by region-wide legal frameworks and business sustainability goals, making Latin America a major source of high-quality carbon credits. Long-term agreements and investments foster reliable nature-based carbon removal technologies, supporting an expanding carbon credit market.

Recent Developments & News

In February 2025, indigenous and local organizations from Central and South America recommended to the Architecture for REDD+ Transactions (ART) improvements for indigenous rights, free, prior, and informed consent, and equitable benefit-sharing in jurisdictional carbon market regulations. Proper implementation could address a USD 4.1 Trillion nature funding gap by 2050.

In September 2024, Meta agreed to buy up to 3.9 million carbon offset credits from BTG Pactual's forestry division by 2038, potentially worth USD 16 Million. This supports Meta's net-zero emissions target by 2030 and involves BTG Pactual's reforestation efforts planting over 7 million seedlings.

In June 2024, BTG Pactual Timberland Investment Group committed to supplying Microsoft with up to 8 million nature-based carbon reduction credits by 2043. This represents the largest carbon dioxide elimination credit transaction to date, tied to a USD 1 Billion forestry and restoration program.

Competitive Landscape

The competitive landscape of the industry has also been examined along with the profiles of the key players.

If you require any specific information that is not covered currently within the scope of the report, we will provide the same as a part of the customization.

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