WINTER CROPS  //  2023 Income and Cost Budgets

Eastern Free State – irrigation

Income and cost budgets for wheat for Eastern Free State
Area Eastern Free State
Crop Wheat
Production system Irrigation

1. Income

Yield: deterministic Ton/ha 6.50
SAFEX simulated price / producer price: 2023 R/ton 6 526
Total deductions R/ton 813
– Transport differential R/ton 353
– Grade differential R/ton 373
– Marketing, handling and statutory levies R/ton 86
Price premiums / Canola back-payment (10% of contracted price) R/ton
Net farm gate price R/ton 5 714
Gross income R/ha R37 138

2. Variable expenditures

Contracting R/ha 1 309
Crop insurance R/ha 2 971
Fertilizer R/ha 9 050
Lime R/ha 499
Seed R/ha 2 647
Fuel R/ha 1 176
Herbicide R/ha 366
Insecticide R/ha 697
Fungicides R/ha
Marketing costs R/ha 124
Repairs and maintenance R/ha 1 627
Casual labour R/ha
Irrigation: Water R/ha 693
Irrigation: Electricity R/ha 1 617
Aerial spray R/ha
Other expenditure: Scheduling / Irrigation Equipment R&M R/ha 19
Total variable expenditure R/ha R22 795
Total variable expenditure R/ton R3 507
3.1 Gross margin R/ha R14 343
3.2 Gross margin R/ton R2 207
Break-even yield T/ha 3.99
Break-even price R/ton R3 507
Source: VKB, GSA and BFAP, updated April 2023.
Gross margin comparison – Baseline: Free State
Graph showing baseline gross margin comparison for Free State irrigation

Gross margin per hectare: Free State

Wheat sensitivity analysis
Yield (t/ha)
Producers price 5.75 6.00 6.25 6.50 6.75 7.00 7.25
R4 714 4 308 5 487 6 665 7 843 9 022 10 200 11 379
R4 964 5 746 6 987 8 228 9 468 10 709 11 950 13 191
R5 214 7 183 8 487 9 790 11 093 12 397 13 700 15 004
R5 464 8 621 9 987 11 353 12 718 14 084 15 450 16 816
R5 714 10 058 11 487 12 915 14 343 15 772 17 200 18 629
R5 964 11 496 12 987 14 478 15 968 17 459 18 950 20 441
R6 214 12 933 14 487 16 040 17 593 19 147 20 700 22 254
R6 464 14 371 15 987 17 603 19 218 20 834 22 450 24 066
R6 714 15 808 17 487 19 165 20 843 22 522 24 200 25 879

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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