2019/2020 Income and Cost Budgets

Northern Cape – irrigation

Income and cost budgets for maize, soybeans, groundnuts and sunflower (oil) for the Northern Cape
Area Northern Cape
Crop Maize Soybeans Groundnuts Sunflower
Production system Irrigation

1. Income
Yield: deterministic Ton/ha 13.50 4.00 3.50 3.20
SAFEX simulated price / producer price: 2020 R/ton 2 610 5 235 9 930 5 258
Total deductions R/ton 354 141 – –
– Transport differential R/ton 285 – – –
– Grade differential R/ton – – – –
– Marketing and handling R/ton 69 141 – –
Price premiums R/ton – – – –
Net farm gate price R/ton 2 256 5 094 9 930 5 258
Gross income R/ha R30 453 R20 374 R36 555 R16 824

2. Variable expenditures
Contracting R/ha 1 400 1 400 3 520 1 400
Crop insurance R/ha 457 1 080 366 421
Fertilizer R/ha 8 876 5 367 6 527 4 727
Lime R/ha 640 – 700 –
Seed R/ha 4 609 2 015 3 039 990
Fuel R/ha 977 441 1 016 844
Herbicide R/ha 255 398 296 133
Insecticide / Fungicides R/ha 2 737 1 284 3 797 239
Marketing costs R/ha – – – –
Repairs and maintenance R/ha 586 228 668 634
Casual labour R/ha 197 – 162 –
Aerial spray R/ha 400 – – –
Irrigation electricity R/ha 3 152 3 152 3 244 2 239
Water R/ha 1 097 1 097 1 129 779
Other expenditure: scheduling/irrigation equipment R&M R/ha 532 532 2 632 532
Total variable expenditure R/ha R25 914 R16 994 R27 095 R12 938
Total variable expenditure R/ton R1 920 R4 248 R7 741 R4 043
3.1 Gross margin R/ha R4 538 R3 380 R9 460 R3 886
3.2 Gross margin R/ton R336 R845 R2 703 R1 214
Break-even yield T/ha 11.49 3.34 2.73 2.46
Break-even price R/ton R1 920 R4 248 R7 741 R4 043
Source: BFAP, GSA and GWK – 2019.
Gross margin comparison – baseline: Northern Cape
Figure 3.1: Gross margin comparison – Baseline: Northern Cape irrigation

Gross margin per hectare: Northern Cape irrigation

Maize sensitivity analysis
Yield (t/ha)
Producers price 12.00 12.50 13.00 13.50 14.00 14.50 15.00
R1 856 -3 645 -2 717 -1 789 -862 66 994 1 922
R1 956 -2 445 -1 467 -489 488 1 466 2 444 3 422
R2 056 -1 245 -217 811 1 838 2 866 3 894 4 922
R2 156 -45 1 033 2 111 3 188 4 266 5 344 6 422
R2 256 1 155 2 283 3 411 4 538 5 666 6 794 7 922
R2 356 2 355 3 533 4 711 5 888 7 066.31 8 244 9 422
R2 456 3 555 4 783 6 011 7 238 8 466 9 694 10 922
R2 556 4 755 6 033 7 311 8 588 9 866 11 144 12 422
R2 656 5 955 7 283 8 611 9 938 11 266 12 594 13 922
Soybeans sensitivity analysis
Yield (t/ha)
Producers price 3.25 3.50 3.75 4.00 4.25 4.50 4.75
R4 694 -1 740 -567 607 1 780 2 954 4 127 5 300
R4 794 -1 415 -217 982 2 180 3 379 4 577 5 775
R4 894 -1 090 133 1 357 2 580 3 804 5 027 6 250
R4 994 -765 483 1 732 2 980 4 229 5 477 6 725
R5 094 -440 833 2 107 3 380 4 654 5 927 7 200
R5 194 -115 1 183 2 482 3 780 5 079 6 377 7 675
R5 294 210 1 533 2 857 4 180 5 504 6 827 8 150
R5 394 535 1 883 3 232 4 580 5 929 7 277 8 625
R5 494 860 2 233 3 607 4 980 6 354 7 727 9 100
Groundnuts sensitivity analysis
Yield (t/ha)
Producers price 2.75 3.00 3.25 3.50 4.00 4.50 5.00
R9 530 1 587.70 4 195 6 803 9 410 14 625 19 840 25 055
R9 630 1 863 4 495 7 128 9 760 15 025 20 290 25 555
R9 730 2 138 4 795 7 453 10 110 15 425 20 740 26 055
R9 830 2 413 5 095 7 778 10 460 15 825 21 190 26 555
R9 930 2 688 5 395 8 103 10 810 16 225 21 640 27 055
R10 030 2 963 5 695 8 428 11 160 16 625 22 090 27 555
R10 130 3 238 5 995 8 753 11 510 17 025 22 540 28 055
R10 230 3 513 6 295 9 078 11 860 17 425 22 990 28 555
R10 330 3 788 6 595 9 403 12 210 17 825 23 440 29 055
Sunflower oil sensitivity analysis
Yield (t/ha)
Producers price 2.45 2.70 2.95 3.20 3.70 4.20 4.70
R4 858 -1 037 178 1 392 2 606 5 035 7 464 9 893
R4 958 -792 448 1 687 2 926 5 405 7 884 10 363
R5 058 -547 718 1 982 3 246 5 775 8 304 10 833
R5 158 -302 988 2 277 3 566 6 145 8 724 11 303
R5 258 -57 1 258 2 572 3 886 6 515 9 144 11 773
R5 358 188 1 528 2 867 4 206 6 885 9 564 12 243
R5 458 433 1 798 3 162 4 526 7 255 9 984 12 713
R5 558 678 2 068 3 457 4 846 7 625 10 404 13 183
R5 658 923 2 338 3 752 5 166 7 995 10 824 13 653
Soybeans margin above/below maize
Yield Price (R/ton)
R4 794 R4 894 R4 994 R5 094 R5 194 R5 294 R5 394
3.00 -7 152 -6 852 -6 552 -6 252 -5 952 -5 652 -5 352
3.25 -5 953 -5 628 -5 303 -4 978 -4 653 -4 328 -4 003
3.50 -4 755 -4 405 -4 055 -3 705 -3 355 -3 005 -2 655
3.75 -3 557 -3 182 -2 807 -2 432 -2 057 -1 682 -1 307
4.00 -2 358 -1 958 -1 558 -1 158 -758 -358 42
4.25 -1 160 -735 -310 115 540 965 1 390
4.50 38 488 938 1 388 1 838 2 288 2 738
4.75 1 237 1 712 2 187 2 662 3 137 3 612 4 087
5.00 2 435 2 935 3 435 3 935 4 435 4 935 5 435

Notes

  • Farm gate price for ground nuts is calculated according to assumptions based on the share of the crop that is graded according to selection grade (40/50-60/70 and 70/80), diverse and crush (human and oil).
  • 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.
  • Fertiliser assumptions (kg/ha): Maize N:P:K – 286:52:80. Soybeans N:P:K – 120:36:50. Ground nuts N:P:K – 160:45:60. Sunflower N:P:K – 100:30:50.
  • Microelements such as calcium, magnesium and zinc are included in the fertiliser costs.
  • 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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