Costing and Benchmarking to Make Money from Wheat

Think Agronomy Newsletter – July 2024

Having recently completed an exercise comparing wheat production costs and gross margins on clients’ farms, it is clear that there are a lot of improvements we can make by learning from each other. Variable costs alone have risen by around 65% in the past five years so it is very important that every input is challenged.

Whilst every farm is very different and has to deal with unique challenges – we are not trying to ‘match’ our costs or inputs with other farms – we can still look at the approaches and techniques that successful farms use to optimise their farming systems. And optimise is the key word; what we are aiming for is to ensure that inputs are appropriate for the individual circumstances of that farm.

We chose wheat because it is grown by all of the farms in the group so there is scope to compare in great detail and to look back at trends over time. Wheat also consistently produces one of the highest gross margins so makes a significant contribution to overall profitability.

Inputs were broken down into categories to define where the money was being spent and remember that we are solely focused on variable costs here; costs that are directly attributable and proportional to the enterprise. We are deliberately not concerned with overhead costs as they are outside the scope of this exercise, although that is not to say they are not important.

The first major cost was fertiliser – typically around 40-50% of variable costs. Fertiliser and nutrients were not only the largest single category but they also showed the largest variation across the farms, ranging from 30-50% of variable costs or just over 10,000 Ksh/ha (78 USD/ha) to 34,000 Ksh/ha (265 USD/ha).

What was behind this wide range across different farms? This was largely due to soil phosphorus (P) levels in the soil test, how responsive the soils were to nitrogen (N), and whether magnesium (Mg) was required. Whilst this cannot be changed – at least not in the short term and without significant investment to build up the soil P levels. What matters is that fertiliser rates are optimised for the individual farm and are based on sound evidence.

What we did learn is that some farms have a lot of variation in soil P levels even on uniform soil types; testing by block to find the appropriate rate can achieve useful savings. The ultimate will be to test by zones or grid and produce variable rate maps.

A sample of 11 wheat-producing farms in Kenya (labelled 1-11 on the horizontal axis)

The next major cost was fungicides, ranging from 8,000 to 14,000 Ksh/ha (62 to 109 USD/ha). We were surprised, as the last time we did this exercise in 2021 the range was 7,700 to 15,800 Ksh/ha (60 to 123 USD/ha). With the weakening of the Shilling, we expected this to be higher. This appeared to come down to growing varieties with better disease resistance which need fewer fungicides, and more knowledge from fungicide trials. Having said that, we do know that Hawk and Robin are among the highest-yielding varieties and that the additional yield more than covers the cost of the extra fungicide.

Seed costs were very similar across the group, and this included seed dressing. There was a trend of slightly lower seed rates on farms with lower rainfall, but this is about identifying the likely potential of the farm and not producing a crop which is too thick and runs out of moisture. There are some farms using variable seed rates but the savings are very small; the more profound benefit was the reduction of lodging in strong areas of the farm.

Herbicides showed a very clear trend from farms that have been doing crop rotation for several years having much lower costs. This could also be partly down to the altitude reducing the occurrence of Eleusine and Eragrostis, however the upshot is that they do not need to apply a pre-emergence herbicide. This saves quite a lot of cost but also potential unseen injury to the crop.

We also saw that farms in rotation used less grass weed herbicide in the crop unsurprisingly, which further added to the herbicide costs. Total herbicide expenditure varied from 4,900 to nearly 17,000 Ksh/ha (38 to 133 USD/ha).

Targeted applications where they are required, like this liming, makes for far greater efficiency.

Insecticide costs were minimal and mainly varied according to Bollworm pressure in the later stages of the crop.

The major practical lessons that came out of the exercise were:

• Test your soil and set fertiliser rates for each block if possible.
• Plant the seed well so that you can use the minimum, sensible seed rate. Planter setup and maintenance are key.
• Grow resistant varieties to reduce fungicide costs. This is even more important if you are growing continuous cereals where Fusarium and Septoria nodorum pressure will be greater. This also takes the pressure off the sprayer so that you can achieve better timeliness.
• Assess weed pressure on each block, rather than going with a single strategy across the whole farm. If you have a block with a particular problem you are invariably better off putting a break crop in rather than throwing money at herbicides.
• There is a clear trend that farms with diverse rotations have improved nutrient availability and lower weed pressure.
• Think impact as well as inputs – well maintained sprayers, clean sprayer water, the correct nozzles will mean that the money you do spend on inputs has a greater impact.

Dry Bean Fertiliser Strategies

With large areas of beans planned for later in the year, now is the time to plan and budget for the inputs needed. Despite a reputation as a low input crop, beans are often very responsive to inputs particularly Phosphorus and Nitrogen and in fact behave less like a legume than any other. We take a look at some of the important decisions to get right.

As a legume, beans do fix Nitrogen but typically less than 45% of their total N requirement at best. The remaining Nitrogen is taken up from this soil, and if this is limited then of course yields will be limited.

Researchers have tried over the years to improve bean rhizobium species but with little success so far. So it is not uncommon to expect beans to fix only 10kg/ha of nitrogen, and in a perfect scenario perhaps 75kg/ha. This is still a long way off other legumes such as peas and soybeans which reliably fix over 150kg/ha of N. Faba beans for example, can fix up to 85% of their nitrogen requirement.

We trialled commonly available bean rhizobium inoculant in trials over three season from May 2022 to September 2023 around Nakuru, and none of the three trials produced a positive result. Bean inoculant success we know is highly dependent on the site, so we were careful to follow the instructions and apply it carefully at planting, chose sites with relatively low residual nitrogen after non-legumes and where residual herbicide carryover (e.g. clopyralid) was a low risk, and where there was typically only 50-70kg/ha of soil residual Nitrogen.

It is well established that nodulation is delayed in soils with high nitrates – after all why would a plant waste energy fixing atmospheric nitrogen if it is freely available in the soil. There was a slight visible improvement in nodulation in our plots with the inoculant, but it was still very low.

We did not look at response to nitrogen fertiliser in the trial series, but looking at work in other parts of the world it is very common to see yield improvements from topdressing beans, albeit with a clear law of diminishing returns.

We did look at phosphorus response in our trials in some detail however, with increasing rates of P applied as triple super phosphate (0.47.0), and there is a very clear yield improvement from increasing rates of P.

In a soil with less than 10ppm of P on the soil test it is advisable to apply 50-60kg/ha P2O5. In other words, 125kg/ha of DAP or TSP. Even on soil tests around 20-30 ppm of P, an application of 30kg/ha of phosphate is recommended.

DAP will of course supply some of the Nitrogen that is required, but I would not encourage farmers to rush out and apply large quantities of urea or CAN to beans just yet. If you have experience of nitrogen topdressing beans however I would love to hear from you.

Profit from Off-Season Break Crops

Once we harvest what will hopefully be successful maize and cereal crops in September and October, there is a five month window in which to potentially earn a bit more income and benefit our soils in the process. We take a look at some of the crop that proactive farmers are already preparing and planning for the Short Rains.

Peas are a high risk and high reward crop. Much of that reward comes in the following crop(s) as they fix Nitrogen, reduce diseases such as Take-all and many Fusariums, improve Phosphorus availability and reduce nematodes. In fact a lot of the benefits that peas provide is confused for nitrogen fixation alone, but they really do so much more.

Peas do not need much rainfall – in fact too much can often cause a crop failure – but it is essential to have a soil with a full profile before you plant. I am now advising farmers not to plant if soil is below 60-70% of field capacity.

You will only find out by digging a hole, and whilst doing that examine the structure of the soil and check for compaction and hard pans. No crops like hard soil, least of all peas.

Peas are a very fast and will typically take between 95 to 130 days to maturity depending on altitude, but just remember that upfront costs are high; seed, inoculant and pre em herbicides can cost over 25,000 ksh/ha before the crop has even emerged from the ground.

Next up is canola – a great crop for reducing diseases especially Fusarium, and puts a deep taproot down which will leave a lasting legacy for the soil structure. It does need moisture however, so if you are in an area where >200mm of rain is not realistic, avoid canola. Like peas there is a ready market for canola seed crushing for oil and in areas with good October/November rain it is a profitable and reliable crop.

Planting needs to be accurate because of the very small seed, and like any crop there are no shortcuts when it comes to soil structure. For the off-season, a relatively fast variety such as Blazer TT is the top choice as it is a tough, hardy plant bred in Australia to survive on minimal rainfall. Avoid the likes of Click CL and Lumen in lower rainfall areas.

Another oilseed options is sunflowers which is a very tough crop. For areas that would expect to receive <200mm rainfall in the short rains, sunflowers are the default choice over canola. The downside is that it takes time – a typical crop will take 150-180 days which could compromise next year’s main season planting.

They are an excellent crop for soil structure and will find moisture from down to 2 metres, but they can be an expensive way to utilise deep moisture. The two real attractions with sunflowers in Kenya to me are firstly the fact that most growers have, or have access to, a precision planter for maize. This will really improve the accuracy of planting, weed competitiveness and yield.

Secondly sunflowers are highly mycorrhizal. This means that their roots form a symbiosis with fungi in the soil which helps them to access more nutrients – particularly phosphorus. The legacy and benefit of this to a following maize or cereal crop is very real.

Varieties such as Hysun 33 are far better than the old, and very uneven KS Fedha which is also very susceptible to Sclerotinia, however Hysun 33 is very tall and prone to lodging. This is unfortunate for a variety which despite being a uniform hybrid is very uncompetitive. Newer varieties are coming that will significantly change this.

Chickpeas are a useful legume and are super hardy in dry conditions, although unlike many others they are hosts to Root Lesion Nematodes, so the benefit in a maize or wheat rotation is usually less than peas for example. I have seen some fantastic nodulation this year from the application of Chickpea rhizobium to the seed so it should be applied as a matter of course.

Dry Beans are often the default choice especially for small scale farmers, and they can provide very good, steady income. I have gradually pushed this crop harder and harder in trials, and it behaves less like a legume than any other bean or pea! Not only are dry beans very responsive to phosphorus (a 10ppm soil needs 50-70 kg/ha of P2O5), but they rarely fix much if any Nitrogen.

The other big limitation with dry beans that is seldom discussed is how good a host they are to Root Lesion AND Root Knot Nematodes. Not good in a cropping system that is predominantly maize. Of course they have a place, especially in dry years, but to balance risk a crop such as canola or sunflowers on part of the area will be much more stable in a wet season.

Six Must-Do Tests for Maize in 2024

1. Leaf tissue test

Collect a leaf sample and send it to a laboratory to discover if there are any obvious nutrient deficiencies. Ask a trained sampler to help if you are unsure how to collect samples. Cost: a few thousand Shillings.

2. Nematodes

If you are on a lighter textured soil and your roots are knotted and spear-tipped, nematodes could be costing you a lot of yield. Cost: a few thousand Shillings.

3. Dig a hole

Is the soil soft, friable and are the roots growing downwards? Or is it compact, hard and platy with roots growing sideways? Cost: free.

4. Apply a fungicide to a small area

Buy a small sample of a fungicide and apply it to part of your crop. Clearly mark the area where you sprayed it and measure the area, yield and grain quality at harvest. Don’t over think it; just try a product containing either azoxystrobin, pyraclostrobin or prothioconazole. Cost: 3-4,000 Shillings.

5. Grain nutrient analysis

Grain Nutrient analysis is a very effective way of determining the success of nutrition in the crop. I suspect that 95% of crops in Kenya are deficient in phosphorus, nitrogen, boron and possibly magnesium. Cost: a few thousand Shillings.

6. Measure the variability of plant spacing

Measure the distance between 30 plants along a row. Put the numbers into a spreadsheet and calculate the Average distance in cm, and the Standard Deviation. Divide the Standard Deviation by the Average, then multiply it by 100. Above 40% CoV is poor and you need to improve your planting, blow 20% is excellent and you have given your plants the best chance. Cost: free.

Till next time,

David Jones,

Independent Agronomist

How would you rate our article?

David is an independent agronomist in Kenya and a member of the Association of Independent Crop Consultants. David gives independent advice based on scientific trials and experience. Currently works with the Centre of Excellence for Crop Rotation.

Think Agronomy is brought to you by Cropnuts and the Centre of Excellence for Crop Rotation. We share the same vision for sustainable, dryland farming across Africa, and Think Agronomy is our independent voice to promote profitable, climate-resilient farming through better management of soil health, systems-based agronomy, crop diversification, and farm mechanization.