Break-even price & yield
Your input costs per hectare against your expected yield: the price and the yield you need to cover them.
Use a realistic yield for a normal season on this land, from your own records if you have them.
What the buyer pays per ton before your marketing and transport costs: a contract, forward or expected spot price.
Enter the area, expected yield and expected price, then your costs, to see the break-even.
How this is calculated
Costs entered per hectare stay the same whatever the harvest. Marketing and transport are entered per ton, because a bigger crop costs more to haul and sell. Blank cost lines count as zero. The worked example is 100 ha of maize expecting 6 t/ha at R4 000/ton, with R15 000/ha of direct costs, R400/ton for marketing and transport, and R3 600/ha of overheads.
- Cost per ha = per-hectare costs + per-ton cost × yield. Direct: 15 000 + 400 × 6 = R17 400/ha. With overheads: 18 600 + 2 400 = R21 000/ha, or R2 100 000 for 100 ha.
- Break-even price (R/ton) = per-hectare costs ÷ yield + per-ton cost. Direct: 15 000 ÷ 6 + 400 = R2 900. With overheads: 18 600 ÷ 6 + 400 = R3 500.
- Break-even yield (t/ha) = per-hectare costs ÷ (price − per-ton cost). Direct: 15 000 ÷ 3 600 = 4.17 t/ha. With overheads: 18 600 ÷ 3 600 = 5.17 t/ha. If the price is no more than the per-ton cost, no yield breaks even.
- Margin = yield × price − cost per ha. Income is 6 × 4 000 = R24 000/ha, so the gross margin over direct costs is R6 600/ha (R660 000 in all) and the margin after overheads is R3 000/ha (R300 000).
- Margin of safety = (expected − break-even) ÷ expected × 100. Price: (4 000 − 3 500) ÷ 4 000 = 12.5% after overheads, 27.5% on direct costs. Yield: (6 − 5.17) ÷ 6 = 13.9% after overheads, 30.6% on direct costs.
The two safety margins are each worked with everything else held at your expected figure. A poor season that cuts both price and yield at once eats into the margin faster than either number suggests.
Overheads are the fixed costs of the whole farm: land rent or bond, permanent labour, depreciation, admin. Share them across your crops by hectare or by how much each uses them. The direct-cost break-even tells you whether a crop is worth planting at all; the total break-even tells you whether it pays its way.
Read the guide: Break-even before you plant: the price and yield your crop needs
Results are estimates for planning. Check product labels and local recommendations before you apply anything.