In November it was announced that TerraMass had been declared bankrupt. It is certainly not the first time that operational installations have gone bankrupt. In addition, various initiatives continue to struggle with licensing. Still, throughput is likely to grow by 15% to 20% in the coming year.
There are 6 initiatives that expect to become operational in 2020. Including Greenferm in Apeldoorn, which will become operational this year, NCM expects an additional processing capacity of 8,4 million kilos of phosphate. The NCM therefore assumes that despite the continuous adjustments to the phosphate standards (as of January 1, 2020, the phosphate use standard for soils with a high status will be lowered), the Netherlands will also be able to meet the legal obligations in the coming years.
In recent years, manure processing capacity has grown, while the phosphate surplus (production minus installation space) has decreased. In the period 2015-2018 even by 37%. As a result, the phosphate surplus and processed and exported quantities of phosphate were already in balance in 2018 and are expected to remain so this year and next year. The manure processing capacity will probably also be sufficient in the years that follow, if the mandatory manure processing percentages are further increased but phosphate production continues to decline.
Adders in the grass
Despite the impending restructuring of pig farming, processing 70% of all pig manure by 2022 is too ambitious a goal, according to the NCM's estimate. And the most important export market for processed manure, West Germany, is shrinking due to tightened manure legislation and enforcement of these regulations. Although the feared new imbalance on the Dutch manure market, due to the shrinking German sales market and thanks to the increased high-quality manure processing capacity and shrinkage of the (milk) livestock herd, has not materialized, partly due to growth in sales in France.
There are even more snakes in the grass. Although phosphate surplus and phosphate processing are in balance, expressed in kilograms of nitrogen the manure market is less in balance. While the European Nitrate Directive does not focus on phosphate but on nitrogen surplus. Increased protein-rich concentrate consumption in dairy farming is a cause of the skewed ratio between phosphate and nitrogen in concentrates. While the amount of phosphate in compound feed was reduced, the amount of nitrogen in feed could actually increase with the growth of dairy farming, although a reversal occurred in 2018 that continued in 2019. Seasonal effects on levels in grass and corn also play a role in this.
Manure processing not cost-effective
Moreover, the equilibrium outlined does not mean that the costs of manure disposal will decrease. Manure processing costs more than it yields. Without long-term contracts and high rates per cubic meter of manure, many installations would not be able to cover costs. That is why manure disposal costs hardly fell in 2018 and 2019, although the imbalance in the manure market has disappeared. It is not without reason that the NCM uses the term manure valorization instead of manure processing in its naming. Manure processing in the Netherlands should ensure manure valorization, says director Jan Roefs. But in practice, most of the manure only undergoes simple processing. A quarter of the manure is not only processed but also converted into a high-quality product with more than 70% dry matter, such as manure granules.
EU legislation hopeful
In a European context, there are 2 developments that can promote the sale of organic fertilizers. Roefs: "One development is the recently published European fertilizer regulation. This makes free trade in the European Union fully possible, via a CE marking. This reduces trade barriers. The other development concerns fertilizer substitutes, which are still in the research phase."
The question here is to what extent fertilizers made from animal manure may be used as a fertilizer substitute. A grower could use these animal manure products in his operating space as fertilizer, in addition to the 170 kilos (or 230 or 250 for derogation companies) that he is allowed to fertilize with animal manure. Roefs: "The European Union and the Netherlands are steadily working towards cycles in which animal manure can better compete with artificial fertilizer, but this should not be at the expense of environmental impact. The first research results from the research project called Safemanure have recently been published and do not appear to be unfavorable."