News Phosphate rights
Generic discount not out of the picture yet
LTO Nederland does not accept a further generic discount, nor does the farmers. Jos Verstraten, member of the Dairy Farming Department at LTO Nederland, reacts to the threat of the excess of phosphate rights. The generic discount is therefore not out of the picture.
Carola Schouten, Minister of Agriculture, Nature and Food Quality (LNV), announced in May that the allocated phosphate rights represent a production of 85,4 million kilos allow phosphate and this volume is still growing. This is remarkable, because Statistics Netherlands published a forecast of 83,3 million kilos of phosphate. This went almost unnoticed by the dairy farmer, but behind the scenes tensions are mounting. What is really going on in the phosphate file?
Sudden Cover
The positive figures from Statistics Netherlands were well received and it even looked for a while that there was room to help the dairy farmers (collected in Innovative from de Knel). Not much later, the flag suddenly changed. It seems that 2 things are intertwined and that could have consequences for the entire sector. Especially when Schouten can't get Brussels along.
The facts: the phosphate rights will be announced on 2 July 2015. No animal rights to give dairy farmers the opportunity to gain space at farm level via the Kringloopwijzer. However, this is not yet available, partly as a result of security problems. Nevertheless, Brussels adheres to the flat-rate standard. This means: so much milk production yields a fixed number. In 2015, the average milk supply per cow was 8.473 kilos, so 42 kilos of phosphate.
Success via feed track
In order to reduce phosphate production to 84,9 million kilos of phosphate, the Dutch dairy sector started working on the phosphate reduction plan in 2017. The feed track in particular was very successful. This resulted in a reduction, with which livestock could be preserved. The problem is that the phosphate rights system, which came into effect on 1 January 2018, is based on the fixed standard. The actual production monitored by Statistics Netherlands is leading for the final production in 2018.
"Because of that fixed standard, linked to the number of allowances distributed, more allowances were distributed than was intended," says Verstraten. The ZLTO foreman explains that the rights were not allowed to be introduced in 2017. This is because the excessive production (linked to the rights) would mean that state aid is distributed. "That has now happened."
State aid
This means that Minister Schouten has to explain to Brussels that the actual production is lower, and that there is therefore no state aid. At the same time, the minister has indicated that Brussels wants the number of allowances at the start of the system to be below 84,9 million kilos of phosphate (the phosphate ceiling for dairy cattle).
If the animal numbers that Statistics Netherlands has added up and the fixed standard are taken, the phosphate production will continue to exceed the ceiling. "If the fixed standard for 2018 is adjusted, then it is important to make sure that no more livestock will be kept," says Verstraten. The other side of the coin is that if the actual phosphate production was taken as leading (when allocating rights), fewer rights would have been distributed.
The exemption for young stock should help to create more space for dairy farmers, as was stated in the letter in May. Harm Wiegersma of the Dutch Dairy Farmers' Union, states that he has yet to see this. "A requirement would be that the animals must be delivered directly to the slaughterhouse, and then the exemption becomes less attractive." Verstraten also indicates that if this phosphate is removed from the dairy cattle, it must also be removed from the dairy cattle phosphate ceiling and then it will not solve anything.
No further discount?
Meanwhile, the next phosphate monitor is approaching. This should show what the actual state of affairs is and where the dairy farming sector stands. The problem, however, is that it is not yet clear what the starting position of the sector will look like. "We do not accept a further generic discount (than that 8,3%), the farmers do not accept that and LTO Nederland does not accept that. It is up to Schouten to convince Brussels that the cows poo less."
Herman van den Pol
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