Forecasting Area, Production and Yield of Cotton in India using ARIMA Model

Abstract

Cotton is an important crop in India. India is the second largest exporter of cotton behind the US. This study focuses on forecasting the cultivated area and production of cotton in India using Autoregressive Integrated Moving Average (ARIMA) model. Time Series data covering the period of 1950–2010 was used for the Study. The study revealed that ARIMA (0, 1, 0) ARIMA (1, 1, 4) and ARIMA (0, 1, 1) are the best fitted model for forecasting of cotton area, production and yield in India respectively. The analysis shows that if the present growth rates continue then the cotton area, production and yield in the year 2020 will be 10.92 million hectares, 39.19 million bales of 170 kg of each and 527 kg/hectare respectively.

Keywords: ARIMA, forecasting, auto correlation function, Akaike information criterion