Inside Milk
Phosphate: interest in lease rights remains
Now that it has become known that the mandatory creaming (10%) of lease rights will remain, there is more clarity in the market. How does the price of phosphate rights respond to this, and what does the price of lease rights do?
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The price of phosphate rights moved last week mainly stable. The market was then waiting for the moment when it would become known whether the mandatory skimming of lease rights would disappear. Minister Carola Schouten (Agriculture, Nature and Food Quality) presented September 14 clarity. She announced that the mandatory skimming remains for lease rights.
The ruling is a downer for some dairy farmers. After all, the market cautiously took into account the fact that Schouten would withdraw the skimming. The result: leasing rights have become less interesting and the demand for purchasing rights has increased further. At the same time, the supply remains limited.
Rating up
The DCA quotation for phosphate rights increases this week by €4 to €274,50 per right. The bandwidth is between €270 and €278 per right. There are also rumors that these prices do not make the choice between 'culling cows' or 'buying phosphate rights' any easier. It seems to be a difficult puzzle to solve for relatively many companies.
Demand for the so-called '0% rights' is lively, with prices up to €200. Despite the fact that skimming is mandatory, the demand for leasing rights remains. Several commission agents claim to have offers between €70 and €80 per right. Dairy farmers generally do not offer more than €50 per right.