Price phosphate right falls below 180 euros

In week 16, the phosphate quotation amounts to €178,50 per right. Most cases took place between €177 and €180,50 per right. This does not mean that there have been dairy farmers who have succeeded in purchasing phosphate rights at lower prices. On Wednesday, prices again had the opportunity to increase slightly and the price is already approaching €180 per right.

Production ceiling
The price fluctuation is a direct response to the news that FrieslandCampina plans to introduce a production ceiling for milk in 2019. This does not mean that the cooperative will no longer collect the liters above that, but it does mean that the milk price for liters will be lower. The news took a while to get through and that made dairy farmers reluctant. It also aroused a lot of emotion. 

Ultimately, it looks like the growers in particular will be affected by this. The majority of dairy farmers will probably have to deal with the reference April 2017 to April 2017. This means that not all liters are yet covered with phosphate rights. Then there is another group that may benefit from the purchase of phosphate rights until April 16. This means that most parties in phosphate rights have been busy in recent days. After all, RVO had to demonstrate that the sales had already taken place earlier.

Less milk?
There is also more and more talk about the end of the year, because the group of dairy farmers with too few rights is still estimated to be large. Not enough allowances means that milk production still has to be purchased or milk production has to be reduced. For now, it's the last option that's most likely. 

Due to the developments, the demand for rights continues to exist and that is the direct explanation that the price is picking up again.