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Forecasting cocoa production of six major producers through ARIMA and grey models

Forecasting cocoa production of six major producers through ARIMA and grey models In the current study, two grey prediction models, Even GM (1, 1) and Non-homogeneous discrete grey model (NDGM), and ARIMA models are deployed to forecast cocoa bean production of the six major cocoa-producing countries. Furthermore, relying on Relative Growth Rate (RGR) and Doubling Time (Dt), production growth is analyzed.Design/methodology/approachThe secondary data were extracted from the United Nations Food and Agricultural Organization (FAO) database. Grey forecasting models are applied using the data covering 2008 to 2017 as their performance on the small sample size is well-recognized. The models' performance was estimated through MAPE, MAE and RMSE.FindingsResults show the two grey models fell below 10% of MAPE confirming their high accuracy and forecasting performance against that of the ARIMA. Therefore, the suitability of grey models for the cocoa production forecast is established. Findings also revealed that cocoa production in Côte d'Ivoire, Cameroon, Ghana and Brazil is likely to experience a rise with a growth rate of 2.52, 2.49, 2.45 and 2.72% by 2030, respectively. However, Nigeria and Indonesia are likely to experience a decrease with a growth rate of 2.25 and 2.21%, respectively.Practical implicationsFor a sustainable cocoa industry, stakeholders should investigate the decline in production despite the implementation of advanced agricultural mechanization in cocoa farming, which goes further to put food security at risk.Originality/valueThe study presents a pioneering attempt of using grey forecasting models to predict cocoa production. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Grey Systems: Theory and Application Emerald Publishing

Forecasting cocoa production of six major producers through ARIMA and grey models

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Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
2043-9377
DOI
10.1108/gs-04-2020-0050
Publisher site
See Article on Publisher Site

Abstract

In the current study, two grey prediction models, Even GM (1, 1) and Non-homogeneous discrete grey model (NDGM), and ARIMA models are deployed to forecast cocoa bean production of the six major cocoa-producing countries. Furthermore, relying on Relative Growth Rate (RGR) and Doubling Time (Dt), production growth is analyzed.Design/methodology/approachThe secondary data were extracted from the United Nations Food and Agricultural Organization (FAO) database. Grey forecasting models are applied using the data covering 2008 to 2017 as their performance on the small sample size is well-recognized. The models' performance was estimated through MAPE, MAE and RMSE.FindingsResults show the two grey models fell below 10% of MAPE confirming their high accuracy and forecasting performance against that of the ARIMA. Therefore, the suitability of grey models for the cocoa production forecast is established. Findings also revealed that cocoa production in Côte d'Ivoire, Cameroon, Ghana and Brazil is likely to experience a rise with a growth rate of 2.52, 2.49, 2.45 and 2.72% by 2030, respectively. However, Nigeria and Indonesia are likely to experience a decrease with a growth rate of 2.25 and 2.21%, respectively.Practical implicationsFor a sustainable cocoa industry, stakeholders should investigate the decline in production despite the implementation of advanced agricultural mechanization in cocoa farming, which goes further to put food security at risk.Originality/valueThe study presents a pioneering attempt of using grey forecasting models to predict cocoa production.

Journal

Grey Systems: Theory and ApplicationEmerald Publishing

Published: Jun 18, 2021

Keywords: Cocoa production; Production economics; Grey forecasting; ARIMA; NDGM

References