Breakeven yields of wheat and canola

Page last updated: Wednesday, 6 May 2020 - 9:53am

Before committing resources to late sown or emerging crops, you should carefully consider the crop's yield potential.

If your expected yield is greater than your variable cost breakeven yield, you will be covering your variable costs and contributing to fixed or overhead costs.

If your expected yield is lower than your variable cost breakeven yield, reassess if the inputs planned will be adding value to the yield potential of a crop emerging in June.

Discussion

A challenge for growers with a late break is the expected yield of their crops and the impact this could have on their bottom line. It is important to carefully consider the crops yield potential before committing resources to late sown or emerging crops.

Yield potential of crops emerging in June can still be reasonable depending on location and seasonal conditions. However, delayed sowing (especially into June) can have a significant impact on yield potential compared to crops sown into moist soil in May.

With the knowledge of your planned variable cost and farm gate price, you can estimate your breakeven yields for wheat and canola (Tables 1 and 2). If your potential yield is greater than your breakeven yield then the crop is covering variable costs and also contributing to fixed or overhead costs. For example, if the farm gate price for a wheat crop is $240 per tonne and the costs of variable inputs is $250 per hectare then the crop needs to yield 1.04 t/ha to breakeven. If the potential yield is higher than this, the enterprise is covering its variable costs and contributing to the fixed or overhead costs. If potential yield is less than 1.04 t/ha then it will be necessary to rethink your input costs.

Table 1 Wheat break even yields (t/ha) to cover variable cost, at farm gate prices  between $170 and $310 per tonne (*: Net on farm price)

Variable Cost

$170/t*

$180/t*

$190/t*

$200/t*

$210/t*

$220/t*

$230/t*

$240/t*

$250/t*

$260/t*

$270/t*

$280/t*

$290/t*

$300/t*

$310/t*

$125/ha

0.74

0.69

0.66

0.63

0.60

0.57

0.54

0.52

0.50

0.48

0.46

0.45

0.43

0.42

0.40

$150/ha

0.88

0.83

0.79

0.75

0.71

0.68

0.65

0.63

0.60

0.58

0.56

0.54

0.52

0.50

0.48

$175/ha

1.03

0.97

0.92

0.88

0.83

0.80

0.76

0.73

0.70

0.67

0.65

0.63

0.60

0.58

0.56

$200/ha

1.18

1.11

1.05

1.00

0.95

0.91

0.87

0.83

0.80

0.77

0.74

0.71

0.69

0.67

0.65

$225/ha

1.32

1.25

1.18

1.13

1.07

1.02

0.98

0.94

0.90

0.87

0.83

0.80

0.78

0.75

0.73

$250/ha

1.47

1.39

1.32

1.25

1.19

1.14

1.09

1.04

1.00

0.96

0.93

0.89

0.86

0.83

0.81

$275/ha

1.62

1.53

1.45

1.38

1.31

1.25

1.20

1.15

1.10

1.06

1.02

0.98

0.95

0.92

0.89

$300/ha

1.76

1.67

1.58

1.50

1.43

1.36

1.30

1.25

1.20

1.15

1.11

1.07

1.03

1.00

0.97

$325/ha

1.91

1.81

1.71

1.63

1.55

1.48

1.41

1.35

1.30

1.25

1.20

1.16

1.12

1.08

1.05

$350/ha

2.06

1.94

1.84

1.75

1.67

1.59

1.52

1.46

1.40

1.35

1.30

1.25

1.21

1.17

1.13

$375/ha

2.21

2.08

1.97

1.88

1.79

1.70

1.63

1.56

1.50

1.44

1.39

1.34

1.29

1.25

1.21

$400/ha

2.35

2.22

2.11

2.00

1.90

1.82

1.74

1.67

1.60

1.54

1.48

1.43

1.38

1.33

1.29

$425/ha

2.50

2.36

2.24

2.13

2.02

1.93

1.85

1.77

1.70

1.63

1.57

1.52

1.47

1.42

1.37

$450

2.65

2.50

2.37

2.25

2.14

2.05

1.96

1.88

1.80

1.73

1.67

1.61

1.55

1.50

1.45

$475/ha

2.79

2.64

2.50

2.38

2.26

2.16

2.07

1.98

1.90

1.83

1.76

1.70

1.64

1.58

1.53

$500/ha

2.94

2.78

2.63

2.50

2.38

2.27

2.17

2.08

2.00

1.92

1.85

1.79

1.72

1.67

1.61

$525/ha

3.09

2.92

2.76

2.63

2.50

2.39

2.28

2.19

2.10

2.02

1.94

1.88

1.81

1.75

1.69

$550/ha

3.24

3.06

2.89

2.75

2.62

2.50

2.39

2.29

2.20

2.12

2.04

1.96

1.90

1.83

1.77

 

Table 2 Canola breakeven yields (t/ha) to cover variable cost, at farm gate prices between $420 and $600 per tonne (*: Net on farm price)
Variable cost $420/t* $440/t* $460/t* $480/t* $500/t* $520/t* $540/t* $560/t* $580/t* $600/t*
$200/ha 0.48 0.45 0.43 0.42 0.40 0.38 0.37 0.36 0.34 0.33
$225/ha 0.54 0.51 0.49 0.47 0.45 0.43 0.42 0.40 0.39 0.38
$250/ha 0.60 0.57 0.54 0.52 0.50 0.48 0.46 0.45 0.43 0.42
$275/ha 0.65 0.63 0.60 0.57 0.55 0.53 0.51 0.49 0.47 0.46
$300/ha 0.71 0.68 0.65 0.63 0.60 0.58 0.56 0.54 0.52 0.50
$325/ha 0.77 0.74 0.71 0.68 0.65 0.63 0.60 0.58 0.56 0.54
$350/ha 0.83 0.80 0.76 0.73 0.70 0.67 0.65 0.63 0.60 0.58
$375/ha 0.89 0.85 0.82 0.78 0.75 0.72 0.69 0.67 0.65 0.63
$400/ha 0.95 0.91 0.87 0.83 0.80 0.77 0.74 0.71 0.69 0.67
$425/ha 1.01 0.97 0.92 0.89 0.85 0.82 0.79 0.76 0.73 0.71
$450/ha 1.07 1.02 0.98 0.94 0.90 0.87 0.83 0.80 0.78 0.75
$475/ha 1.13 1.08 1.03 0.99 0.95 0.91 0.88 0.85 0.82 0.79
$495/ha 1.18 1.13 1.08 1.03 0.99 0.95 0.92 0.88 0.85 0.83
$515/ha 1.23 1.17 1.12 1.07 1.03 0.99 0.95 0.92 0.89 0.86
$535/ha 1.27 1.22 1.16 1.11 1.07 1.03 0.99 0.96 0.92 0.89
$555/ha 1.32 1.26 1.21 1.16 1.11 1.07 1.03 0.99 0.96 0.93
$575/ha 1.37 1.31 1.25 1.20 1.15 1.11 1.06 1.03 0.99 0.96
$595/ha 1.42 1.35 1.29 1.24 1.19 1.14 1.10 1.06 1.03 0.99

 

 

 

 

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Author

Christine Zaicou-Kunesch