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September 2025
| CATHRINE MATHEKGA, ECONOMIST INTERN AND MLIBO QOTOYI, ECONOMIST INTERN, GRAIN SA |
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AS THE PLANTING SEASON DRAWS NEAR, IT'S A CRITICAL TIME FOR EVERY FARMER TO PAUSE AND PLAN. WHILE THE DESIRE TO SIMPLY GET THE CROP IN THE GROUND IS STRONG, A PROFITABLE SEASON STARTS WITH A SOUND BUDGET. TOO OFTEN, FARMERS MOVE FROM ONE SEASON TO THE NEXT WITHOUT A CLEAR UNDERSTANDING OF THEIR COSTS.
A budget is more than just a list of expenses; it's a vital tool that helps you make informed decisions about which crops to plant, what yield to target, and how to maximize your returns. A budget helps you organize key financial information, allowing you to compare your expected earnings with your anticipated costs.
For grain farmers, these costs are typically split into two categories: (1) fixed costs (expenses like rent, salaries and wages that remain constant regardless of production) and (2) variable costs (inputs like seed, fertiliser, chemicals and diesel that change with your production choices). Understanding these costs is the first step toward making smart decisions.
INPUT COSTS: A MIXED BAG OF PRESSURES
This season presents a mixed picture of rising input costs, with some areas offering a little relief while others see sharp increases.
The biggest driver of costs
Fertiliser remains the single largest variable cost for crops like maize, accounting for roughly 30% to 35% of the total. While nitrogen prices have dropped by about 13% since last year, this relief is unfortunately offset by significant increases in phosphate (+22,3%) and potassium (+12%).
In North West, fertiliser costs for maize range from about R3 300/ha for lower yield targets to nearly R6 900/ha for higher yields. In the Eastern Free State, this figure can reach up to R8 900/ha. Given these high costs, the importance of soil testing cannot be overstated. It is the most effective way to ensure you apply the right amount of fertiliser, avoiding unnecessary expenses.
Other inputs
Seed prices have increased across the board, though at varying rates:
While fuel costs have eased slightly (-4,6%), chemical costs have seen a significant jump, rising by 14,5%. These shifts highlight the importance of updating your budget with the latest figures before making any final planting decisions.
New rules on chemical use: The rise of PCOs
An area of growing concern is the impact of new regulations on production costs. Since August 2023, stricter rules on agricultural remedies under Act 36 of 1947 require certain products to be applied only by a registered Pest Control Operator (PCO). This shift affects how farmers manage crop protection and can increase operational costs.
REGIONAL COST COMPARISONS: MATCHING CROPS TO POTENTIAL
Grain SA’s budgets for the 2025/2026 season reveal clear differences in costs and profitability between crops and regions. These figures are vital for matching your crop choice to your land's specific yield potential.
On lower-potential land, oilseeds like groundnuts and sunflower often deliver better margins because they require less upfront cash, making them a more financially sound choice. On high-potential land, maize can become more cost-effective per ton as yields climb, benefitting from economies of scale.
FINAL WORD
The profitability of any crop is ultimately a function of three things: Price, yield, and cost. While you have limited control over market prices and weather, you have full control over how you spend your money before a seed even touches the soil.
For the 2025/2026 season, careful budgeting, efficient input use and staying compliant with new regulations are not just good practices, they are the foundations of a profitable farming operation. Making these deliberate choices now will ensure this season is a rewarding one.
Publication: September 2025
Section: Pula/Imvula