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INPUT AND PRODUCTION OVERVIEW
COMMERCIAL BUDGETS
1
Monthly profitability calculations for the 2022/2023 season
Due to input costs constantly increasing, Grain SA monitored the profitability situation of grain and
oilseeds monthly since February 2022. As new information emerges every month, whether it is input
costs such as fertiliser or fuel prices or the Safex price, the profitability situation for the upcoming summer
grain season was estimated to give producers and the industry an idea of grain and oilseed profitability.
The monthly changes in total variable costs (
Graph 18
and
20
[on page 95 - 96]) and gross margin
comparison (
Graph 19
and
21
[on page 96 - 97]) for the western and eastern regions are presented
in the following section. These increases are of great concern as grain producers are price takers in
terms of input costs and these higher costs cannot be passed on to consumers. Producers therefore
absorb any input price increases.
Western parts of the country
Graph 18
shows the estimated total variable costs on a monthly basis for North West, with the first
scenario compiled in the 2021/2022 production season and estimated production cost figures for the
2022/2023 production season, as compiled with input costs as available in August 2022. The total
variable costs for maize increased from R9 200/ha (as determined for the 2021/2022 production sea-
son) to R13 017/ha (August 2022). This is a drastic increase of 42%, of which fertiliser is the biggest
contributing factor. According to further calculations, during the same period, the total variable costs
of sunflower and soybeans increased by an average of ± 39% to 42%.
GRAPH 18
WESTERN REGION: TOTAL VARIABLE COSTS
MAIZE
SUNFLOWER
SOYBEANS
14 000
12 000
10 000
8 000
6 000
4 000
2 000
0
2021/2022 SEASON
2022/2023 (APRIL 2022)
2022/2023 (JULY 2022)
2022/2023 (MARCH 2022)
2022/2023 (JUNE 2022)
2022/2023 (FEBRUARY 2022)
2022/2023 (MAY 2022)
2022/2023 (AUGUST 2022)
R/ha
+42%
+42%
+39%
1
Disclaimer: The information here has been obtained from various sources, and Grain SA does not guarantee the accuracy and/
or completeness of this and accepts no liability. Any prices or levels contained in these budgets are preliminary and indicative
only and do not represent bids or offers. These indications are provided solely for your information and consideration.