The phosphate rights trade is still in calm waters. The price moved quite stable in July. What are the expectations for the near future?
In recent weeks, trading in phosphate rights has been pushed to the background and insiders do not expect any activity in the coming month. The holiday period has brought calm to the market and although traders are being informed, there is a wait-and-see attitude among buyers.
Trade may pick up again in September, but in recent years the busy period has increasingly been pushed to the last two months of the year. The trade in leasing rights is still not an issue and this is largely due to the skimming percentage, which makes leasing financially unattractive.
Stable price
The DCA quotation of phosphate rights for week 31 amounts to €144,50 per right. This is a slight increase of €0,50 compared to last week. When we look at the price development over the month of July, we see a fairly stable trend, which corresponds to market movements.
Trading is expected to remain at a low level in the coming weeks. Because higher milk prices are also matched by higher feed prices, the financial position of dairy farmers hardly improves and no impulsive purchases are made.
The Dutch milk supply this year cannot match last year's production level. In view of the shrinking market and the marketing of remaining phosphate rights, a price-pressure effect in the longer term cannot be ruled out.