Indian Journal of Agricultural Research

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Research Article

Indian Journal of Agricultural Research, volume 53 issue 3 (june 2019) : 315-320

Forecasting monthly farm tractor demand for India using MSARIMA and ARMAX models

Alok Yadav, Sajal Ghosh
1Management Development Institute, Gurgaon-122 001, Haryana, India.
Cite article:- Yadav Alok, Ghosh Sajal (2019). Forecasting monthly farm tractor demand for India using MSARIMA and ARMAX models. Indian Journal of Agricultural Research. 53(3): 315-320. doi: 10.18805/IJARe.A-5185.

ABSTRACT

Because of long product development cycles, effective production planning of automobiles requires accurate demand forecasting in order to effectively managing resources and maximizing revenue. Errors in demand forecasts have often led to enormous costs and loss of revenue due to suboptimal utilization of resources. Since early 2000 India has been the largest manufacturer and consumer of farm tractors in the world. This paper develops multiplicative seasonal autoregressive integrated moving average (MSARIMA) and autoregressive moving average model with exogenous variable (ARMAX) to forecast monthly demand for farm tractor. The result indicates that ARMAX with real agriculture credit has found to be outperformed MSARIMA model in forecasting demand of farm tractors in the horizon of six months. The accurate monthly forecasting of farm tractor would help the manufacturers for better raw material, inventory and supply chain management.

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