WINTER CROPS  |  2021 Income and Cost Budgets

Limpopo – irrigation

Income and cost budgets for wheat and barley for Limpopo
Area Limpopo
Crop Wheat Barley
Production system Irrigation

1. Income
Yield: deterministic Ton/ha 6.50 6.00
SAFEX simulated price / producer price: 2021 R/ton 4 955 4 955
Total deductions R/ton 338 301
– Transport differential R/ton 224 224
– Grade differential R/ton 3 –
– Marketing, handling and statutory levies R/ton 111 77
Price premiums / Canola back-payment (10% of contracted price) R/ton – 65
Net farm gate price R/ton 4 617 4 435
Gross income R/ha R30 010 R26 611

2. Variable expenditures
Contracting R/ha 886 886
Crop insurance R/ha 1 681 1 490
Fertilizer R/ha 4 183 3 537
Lime R/ha 605 605
Seed R/ha 1 282 1 245
Fuel R/ha 1 120 1 111
Herbicide R/ha 288 464
Insecticide R/ha 183 165
Fungicides R/ha – –
Marketing costs R/ha 122 141
Repairs and maintenance R/ha 790 675
Casual labour R/ha – –
Irrigation: Water R/ha 1 569 1 336
Irrigation: Electricity R/ha 3 195 2 721
Aerial spray R/ha 320 333
Other expenditure: Scheduling / Irrigation Equipment R&M R/ha 620 484
Total variable expenditure R/ha R16 843 R15 194
Total variable expenditure R/ton R2 591 R2 532
3.1 Gross margin R/ha R13 167 R11 418
3.2 Gross margin R/ton R2 026 R1 903
Break-even yield T/ha 3.65 3.43
Break-even price R/ton R2 591 R2 532
Source: GSA, BFAP and Obaro, April 2021.
Gross margin comparison – Baseline: Limpopo
Gross margin comparison – Baseline: Limpopo irrigation

Gross margin per hectare: Limpopo

Wheat sensitivity analysis
Yield (t/ha)
Producers price 5.75 6.00 6.25 6.50 6.75 7.00 7.25
R3 617 3 955 4 859 5 763 6 667 7 572 8 476 9 380
R3 867 5 392 6 359 7 326 8 292 9 259 10 226 11 193
R4 117 6 830 7 859 8 888 9 917 10 947 11 976 13 005
R4 367 8 267 9 359 10 451 11 542 12 634 13 726 14 818
R4 617 9 705 10 859 12 013 13 167 14 322 15 476 16 630
R4 867 11 142 12 359 13 576 14 792 16 009 17 226 18 443
R5 117 12 580 13 859 15 138 16 417 17 697 18 976 20 255
R5 367 14 017 15 359 16 701 18 042 19 384 20 726 22 068
R5 617 15 455 16 859 18 263 19 667 21 072 22 476 23 880
Barley sensitivity analysis
Yield (t/ha)
Producers price 5.25 5.50 5.75 6.00 6.25 6.50 6.75
R3 435 2 841 3 700 4 559 5 418 6 277 7 136 7 994
R3 685 4 154 5 075 5 997 6 918 7 839 8 761 9 682
R3 935 5 466 6 450 7 434 8 418 9 402 10 386 11 369
R4 185 6 779 7 825 8 872 9 918 10 964 12 011 13 057
R4 435 8 091 9 200 10 309 11 418 12 527 13 636 14 744
R4 685 9 404 10 575 11 747 12 918 14 089 15 261 16 432
R4 935 10 716 11 950 13 184 14 418 15 652 16 886 18 119
R5 185 12 029 13 325 14 622 15 918 17 214 18 511 19 807
R5 435 13 341 14 700 16 059 17 418 18 777 20 136 21 494

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 costs for wheat, barley and oats seeds reflect a combination of own and purchased seed.
  • It is important to note that overhead costs are not included and should be accounted for. Overhead costs such as interest on production loans, labour, management and administration will vary to a large extent from producer to producer. Producers will therefore have to deduct the farm business' overhead cost from the gross margins as stipulated in the tables and figures to calculate the net income per crop.
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