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Contract Farming Return Calculator

Work out contract farming return instantly with clear inputs, formula shown and shareable results.

About Contract Farming Return Calculator

A contract locks the price, so the return depends only on yield and cost. Profit per hectare is contract price x yield minus cost of production, and the break-even price shows the minimum the contract must offer to be worth signing at your realistic yield.

Formula

Contract return

Profit per ha = contract price x yield - cost per ha; break-even price = cost per ha / yield

Worked example

With the default values below, Contract Farming Return Calculator returns Contract Profit of $150,000.00. Change any input above and every figure here is recalculated in your browser.

Inputs used

Contracted Priceminimum 0 per tonne
22,000 per tonne
Expected Yieldminimum 0 t/ha
4 t/ha
Contracted Areaminimum 0.01 ha
5 ha
Cost Of Productionminimum 0 per ha
58,000 per ha

Results

Contract Profit
$150,000.00
Profit Per Hectare
$30,000.00
Contract Revenue
$440,000.00
Break-Even Contract Price
$14,500.00

Step by step

  1. 1Values used
  2. 2Contract return
  3. 3Contract Profit= 150,000.00
  4. 4Profit Per Hectare= 30,000.00
  5. 5Contract Revenue= 440,000.00
  6. 6Break-Even Contract Price= 14,500.00

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, tax or compounding frequency into account.
  • Figures are rounded for display to 2 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Frequently Asked Questions

What contract terms most affect the return?

Rejection and grading criteria, who supplies inputs and at what price, payment timing, and whether the price is fixed or indexed. A high headline price with tight rejection rules can pay less than a lower open-market price.

Should I contract the whole area?

Splitting the area between contract and open market spreads price and rejection risk, provided the contract does not require exclusivity.

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