Analysis Phosphate rights
New milk money and rain push up the price of phosphate rights
The price of phosphate rights has risen sharply this week compared to previous weeks. On average, between €3,00 and €5,00 has been added to the price of a purchase right. The increased interest in the lease market is much less noticeable.
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Traders did not quite see the sharply increasing demand for phosphate rights coming. They attribute this to the significantly higher milk price that parties such as FrieslandCampina have announced. Dairy farmers feel that they have more financial scope again.
Recent rainfall and better growth prospects for the crop also play a role. There is some concern about a possible derogation problem, but buyers now apparently see this as a calculated risk.
A current problem for buyers is that the supply of rights is quite small. Agencies therefore record the names of prospective buyers on a waiting list and serve them when new batches of phosphate are offered.
The demand for leasing rights has changed little, just like the price. In fact, two markets have emerged in the leasing field: for parties above 100 kilos, which are subject to skimming, and for parties under 100 kilos. Most trade takes place in the small lease lots. The lease price for this is between €16 and €17. The price for the large parties is higher (reportedly around €30), but trade has also virtually come to a standstill.