Inside Milk
Phosphate rights fall sharply in value in a week
Phosphate rights have fallen in value considerably in the past week. The supply of stopping dairy farmers is still generous, while the majority of buyers are not in a hurry and are looking to see where the bottom in the phosphate rights market will lie.
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The DCA quotation for phosphate rights amounts to €40 per kilo in week 125. This is no less than €8 less than last week. This brings the value of phosphate rights below €2017 per kilo for the first time since the spring of 130. The price plunge actually only came about in the past few days.
Market relies on supply
The recommendations of the Remkes committee, to curb nitrogen emissions, did not have a direct effect on the phosphate rights market. Only at the end of last week did the quotation reach the level of €130, after which it remained there for a while. Once this resistance was broken, there was no stopping it and the price quickly fell in value.
Phosphate rights remain a market that relies on supply. Although transactions do take place, the majority of buyers are active in inquiring about price movements without actually purchasing. The trade is still unsure as to where the price drop will end.