Analysis Manure
Manure market remains nervous, trade in VVOs still calm
The situation on the Dutch manure market remains tense, with the DCA Benchmark Prices - Manure still tending upwards for the time being. At the same time, day trading is relatively quiet because dairy farmers in particular are not exactly generous with the removal of manure. Arable farmers with storage capacity are increasingly starting to inquire about manure again. As for the trade in Replacement Processing Agreements (VVOs), it is probably the calm before the storm.
The much-desired reduction in manure disposal costs for livestock farmers is not yet on the agenda. In various regions in the East and South of the Netherlands, collection contributions continue to rise slowly, as is evident from the DCA listings. The upward trend is expected to continue until the turn of the year. Livestock farmers with a large paper manure stock will still have to dispose of manure in the last weeks of 2024.
The physical stocks in the cellars are not excessively large, because in the last weeks of the extended spreading season a lot of manure has been put on the land. For intermediaries and manure traders the current manure supply is therefore all in all perfectly manageable.
Storage often still empty
Arable farmers with storage space are increasingly entering the market, as reported by various parties. At this stage, it often remains a matter of orientation about the amounts they can receive; as a rule, these are between €20 and a maximum of €30 per cubic metre. The top end of the market can only be reached if the transport distances between the livestock farmer and the storage space are very limited. Much storage space is also currently unused among intermediaries. Rough estimates are that between 10% and 20% has only just been filled.
There is still a lot of work to be done in the coming months. After all, stocks need to be replenished towards the start of the spreading season. This could possibly relax the market from 2025 onwards. Especially since livestock farmers will only remove the bare minimum until the start of the spreading season. Significant decreases are unlikely before the spreading season and historically not usual either.
Cautious trading in VVOs
As the turn of the year approaches, the trade in VVOs is picking up. The DCA quotation is rising to €2,23 per kilo this week. There is currently a lot of information being provided, but large volumes are not yet being traded. Buyers are hesitating against high prices. In addition, dairy farmers often do not yet know exactly how many kilos must be purchased. The extent of the processing obligation depends on the region in which a livestock farmer is located. As in previous years, this concerns 59% in the southern region, 52% in the eastern region and 10% in the rest of the country.
Livestock farmers have until New Year's Eve to get their manure accounts for 2024 in order. The expectation is that, as in previous years, trade will only really get going after Christmas. However, the question is whether livestock farmers are wise to wait so long for market developments, according to insiders. The demand seems to be considerably greater than the supply.
Wouter Job
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