Input costs (fertilizers, machinery, services) have increased many times faster from 2019 → 2026 than the wheat price, which has essentially stayed flat. At the same time, Estonia’s average wheat yield has not increased in 2019–2024 but has rather declined, making winter wheat profitability extremely fragile. According to this methodology, winter wheat reaches profitability before subsidies only at very high yields, and the grain price (e.g. 210 / 230 / 250 €/t) shifts the break-even point dramatically.
What has actually changed from 2019 → 2026?
| Indicator | 2019 | 2025/2026 | Change |
|---|---|---|---|
| Food wheat price | 185 €/t | 190 €/t | +2.7% |
| N27+4S fertilizer | 262 €/t | 365 €/t | +39.3% |
| NPK 10-26-26 fertilizer | 369 €/t | 579 €/t | +56.9% |
| 250 hp tractor in the UK (Farmer’s Weekly data) | £200,000 | £250,000 | +25% |
| 370 hp combine with 7.6 m header in the UK (Farmer’s Weekly data) | £300,000 | £422,000 | +41% |
| Big Mac burger (as an inflation indicator) | $4.71 | $6.12 | +30% |
Why this choice of years? Because in my own perception, 2019 was the last more-or-less stable year before things really started going off the rails, especially in terms of prices.
But maybe yields have also increased by roughly the same magnitude? Maybe we are farming better and able to offset these cost increases through more efficient production and input use?
Average wheat yields in Estonia, 2019–2024 (Statistics Estonia)
- 2019: 5.0 t/ha
- 2020: 5.0 t/ha
- 2021: 4.0 t/ha
- 2022: 4.7 t/ha
- 2023: 4.0 t/ha
- 2024: 4.3 t/ha
Conclusion:
In five years, we’ve made a leap… backwards.
In this and the following posts, I will examine Estonia’s most popular crops. At what yield level do we cover variable inputs? And at what yield do we reach break-even including inputs and fixed costs, without subsidies?
Fixed costs vary hugely between farms. There are farms with almost no loans and therefore minimal interest, and others where interest alone is nearly suffocating. Add labor, repairs, etc., and fixed costs can range from 300–700 €/ha or even more. Everyone can calculate their own figures, but in this table we’ll use an average of 500 €/ha.
Winter wheat – the largest crop by area in Estonia and presumably the main cash cow?!
Assumptions for the calculation
To produce 1 t of yield, wheat requires 25 kg N, 5 kg P, and 12 kg K.
Fertilizer prices: NPK 10-26-26 579 €/t, N27+4S 365 €/t.
Crop protection according to yield expectation
- 1–2 t/ha – herbicide (Rexade 30 €/ha)
- 3–4 t/ha – herbicide (30 €/ha) + fungicide (single active ingredient 11 €/ha)
- 5–6 t/ha – herbicide (30 €/ha) + 2 fungicides with multiple actives (25 €/ha + 35 €/ha)
- 7–8 t/ha – herbicide (30 €/ha) + 3 fungicides with multiple actives (25 €/ha + 35 €/ha + 35 €/ha)
- Growth regulators and micronutrients could be added, but their cost (when used sensibly) is marginal compared to herbicides and fungicides, so they are excluded.
Technology and logistics
- Reduced tillage – 2× disc harrow + drilling.
- Fuel consumption: 2× tillage = 12 l/ha + drilling 7 l/ha + fertilizing and spraying 1 l/ha + harvesting 15 l/ha. Diesel price 0.6 €/l. As yield-related extra passes are relatively cheap, I use an average of 30 €/ha in the table.
- Drying is purchased as a service at 20 €/t.
- Transport distance is 100 km from farm to point of sale.
- We assume Class III food wheat in all cases.
All costs are shown in €/ha. The table does not include subsidies.
| Yield t/ha | Revenue €/ha | Fertilizer | Crop protection | Seed | Fuel | Gross margin | Drying 18→13 | Transport | Fixed costs | Result €/ha |
| 1 | 190 | 57 | 30 | 100 | 30 | -27 | 20 | 10 | 500 | -557 |
| 2 | 380 | 115 | 30 | 100 | 30 | 105 | 40 | 20 | 500 | -455 |
| 3 | 570 | 172 | 41 | 100 | 30 | 227 | 60 | 30 | 500 | -363 |
| 4 | 760 | 230 | 41 | 100 | 30 | 359 | 80 | 40 | 500 | -261 |
| 5 | 950 | 288 | 90 | 100 | 30 | 442 | 100 | 50 | 500 | -208 |
| 6 | 1140 | 345 | 90 | 100 | 30 | 575 | 120 | 60 | 500 | -105 |
| 7 | 1330 | 403 | 135 | 100 | 30 | 662 | 140 | 70 | 500 | -48 |
| 8 | 1520 | 461 | 135 | 100 | 30 | 794 | 160 | 80 | 500 | +54 |
How to read the table:
Green = profit before subsidies
Red = loss before subsidies
Clearly this table is somewhat rough and can be criticized in places, but it gives a good overall picture. According to this table, reaching profitability requires an average wheat yield of 8 t/ha! We’ve all heard legends, but such a REAL average yield usually remains a dream.
If we assume the farmer is environmentally friendly and receives additional payments, total subsidies might be around 200 €/ha. If there is no rented land eating up those subsidies, it is possible to break even at a 5 t/ha yield. With a high share of rented land, however, it’s time to double Estonia’s average yield just to reach zero before subsidies. Congratulations to us all!
One must also remember that the point of farming is not merely to reach zero, but to earn a profit in order to invest. Therefore, wheat yields below 6 t/ha are simply not acceptable. And the land should be owned 😀
Grain price determines everything
- 210 €/t – break-even at 6 t/ha
- 230 €/t – break-even already at 5 t/ha
- 250 €/t – break-even already at 4+ t/ha
Important: all of the above applies before subsidies.
To reach 250 €/t, the wheat price would need to increase by 31% – exactly the same magnitude as inflation over the past six years.
The problem is not so much rising costs as the grain price’s lack of inflation resistance.
In the next post, we’ll see whether winter rapeseed brings rivers of gold and mountains of porridge home?
