2017/2018 Income and Cost Budgets

North West – irrigation

Income and cost budgets for maize, soybeans, sunflower and sorghum for North West (Brits region)
Area North West: Brits, Northam and Koedoeskop
Crop Maize Soybeans Sunlower Sorghum
Production system Irrigation

1. Income
Yield: deterministic Ton/ha 12.00 3.80 3.00 7.00
SAFEX simulated price: 2018 / producer price R/ton 2 208 5 221 5 243 2 911
Total deductions R/ton 190 59 238 63
– Transport differential R/ton 127 – 145 –
– Grade differential R/ton – – – –
– Marketing and handling R/ton 63 59 93 63
Price premiums R/ton – – – –
Net farm gate price R/ton 2 018 5 162 5 005 2 848
Gross income R/ha R24 216 R19 616 R15 014 R19 934

2. Variable expenditures
Contracting R/ha – – – –
Crop insurance R/ha 1 453 981 300 498
Fertilizer R/ha 6 698 2 115 1 847 3 557
Lime R/ha 425 425 – 425
Seed R/ha 3 880 1 834 820 618
Fuel R/ha 990 743 776 788
Herbicide R/ha 353 857 772 741
Insecticide R/ha 78 225 33 157
Fungicides R/ha – – – –
Marketing costs R/ha – – – –
Repairs and maintenance R/ha 689 609 547 572
Casual labour R/ha – – – 120
Aerial spray R/ha – – 200 200
Irrigation electricity R/ha 3 772 2 572 1 143 1 715
Water R/ha 334 228 101 152
Other expenditure: scheduling/irrigation equipment R&M R/ha 370 370 370 370
Total variable expenditure R/ha R19 042 R10 959 R6 911 R9 912
Total variable expenditure R/ton R1 587 R2 884 R2 304 R1 416
3.1 Gross margin R/ha R5 175 R8 657 R8 103 R10 021
3.2 Gross margin R/ton R431 R2 278 R2 701 R1 432
Source: BFAP, GSA, NWK and individual farmers – 2017.
Gross margin comparison – baseline: North West (Brits)
Gross margin comparison baseline: North West Irrigation - Brits

Gross margin per hectare: North West (Brits)

Soybeans sensitivity analysis
Yield (t/ha)
Producers price 3.00 3.25 3.50 3.80 4.00 4.25 4.50
R4 250 1 791 2 854 3 916 5 191 6 041 7 104 8 166
R4 500 2 541 3 666 4 791 6 141 7 041 8 166 9 291
R4 750 3 291 4 479 5 666 7 091 8 041 9 229 10 416
R5 000 4 041 5 291 6 541 8 041 9 041 10 291 11 541
R5 162 4 527 5 818 7 108 8 657 9 689 10 980 12 270
R5 500 5 541 6 916 8 291 9 941 11 041 12 416 13 791
R5 750 6 291 7 729 9 166 10 891 12 041 13 479 14 916
R6 000 7 041 8 541 10 041 11 841 13 041 14 541 16 041
R6 250 7 791 9 354 10 916 12 791 14 041 15 604 17 166
Sunflower sensitivity analysis
Yield (t/ha)
Producers price 2.25 2.50 2.75 3.00 3.25 3.50 3.75
R4 000 2 089 3 089 4 089 5 089 6 089 7 089 8 089
R4 250 2 652 3 714 4 777 5 839 6 902 7 964 9 027
R4 500 3 214 4 339 5 464 6 589 7 714 8 839 9 964
R4 750 3 777 4 964 6 152 7 339 8 527 9 714 10 902
R5 005 4 350 5 601 6 852 8 103 9 354 10 605 11 856
R5 250 4 902 6 214 7 527 8 839 10 152 11 464 12 777
R5 500 5 464 6 839 8 214 9 589 10 964 12 339 13 714
R5 750 6 027 7 464 8 902 10 339 11 777 13 214 14 652
R6 000 6 589 8 089 9 589 11 089 12 589 14 089 15 589
Soybeans margin above/below maize
Yield Price (R/ton)
R4 500 R4 750 R5 000 R5 162 R5 500 R5 750 R6 000
2.75 -3 759 -3 071 -2 384 -1 938 -1 009 -321 366
3.00 -2 634 -1 884 -1 134 -648 366 1 116 1 866
3.25 -1 509 -696 116 643 1 741 2 554 3 366
3.50 -384 491 1 366 1 933 3 116 3 991 4 866
3.80 966 1 916 2 866 3 482 4 766 5 716 6 666
4.00 1 866 2 866 3 866 4 514 5 866 6 866 7 866
4.25 2 991 4 054 5 116 5 805 7 241 8 304 9 366
4.50 4 116 5 241 6 366 7 095 8 616 9 741 10 866
4.75 5 241 6 429 7 616 8 386 9 991 11 179 12 366

Notes

  • The cost items reflect the input allocation based on the target yield for the respective crops.
  • Although some expenditure items are zero, it is reflected in the budgets to allow for individual inclusion.
  • The cost of fuel includes pre-harvest and harvesting costs with the assumption that own machinery is used.
  • The cost for soybean seed reflects a combination of own and purchased seed.
  • There will be large fluctuations for insurance cost (hail) based on the associated risk in respective areas. It is advised that producers adjust this cost based on their individual premiums.
  • It is important to note that overhead costs are not included and should be accounted for.
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