Phosphate rights price puts food in the spotlight

There is still much to be gained in the field of feed. This is further underlined by the large fluctuations in the phosphorus content of maize and grass. The problem, however, is that, for example in the cultivation of silage maize, it is not clear, which means that the phosphorus levels fluctuate considerably from year to year. Although a connection is made with the weather, there is not enough information for dairy farmers to manage this.

Difficult to manage phosphorus
Interim monitoring is better in grass, but there too it is difficult to control phosphorus directly. Reducing the amount of concentrate given is then the solution that has the most control. Then there is the question of how much profit can be achieved, because the reference is one from the past and monitoring is based on I&R. For 2017, it looks like dairy farmers will be stuck. Otherwise, they opt for more young cattle and less milk or the highest possible milk production. Afterwards, food may provide some breathing space.       

In the meantime, we must also pay attention to whether the data on Milkweb is correct and beef farmers are attempting to challenge the drastic regulation. It explains why it is quiet on the feed market. Prices remain unchanged. 150 euros for meadow hay, compared to 58 euros free of charge for silage maize. The price for silage grass amounts to 35 euros per tonne. Grass seed hay starts at 120 euros per tonne with low demand. It is only straw that holds prices. This will therefore start from a price of 110 euros per tonne, free of charge.

Uncertainty about stoppers    
As far as can be determined, it is not yet clear who will and who will not participate in the quitter scheme. This also causes uncertainty, both in the supply of feed and phosphate rights. At the beginning of 2018, dairy farmers will regain control over their own livestock through rights and pre-sorting is already underway. As far as the reduction in the livestock population in 2017 allows.  

It is expected that trade will really get going in the second half of 2017, when dairy farmers have the final determination of the rights. Until then, things will take place piecemeal. This costs 117 to 121 euros per right, subject to a number of matters. It translates into a price of 4.914 to 5.082 euros per cow based on 42 kg of phosphate.

Information is being given about leasing, but there is still too much uncertainty about the skimming off during the transaction to actually trade. Initially, 10 percent was mentioned for each transfer. 

In summary, phosphate rights remain price-sensitive, roughage prices have fallen slightly and dairy farmers are faced with shrinkage. The only exception are land-based dairy farmers who have not grown since July 2, 2015.