Application of ARIMA Model to Forecast Corn Prices in Mexico

Leo Guzma´n-Anaya

doi:10.55965/setp.4.08.a3

Authors

Leo Guzmán-Anaya Profesor Investigador en el Centro Universitario de Ciencias Económico-Administrativas (CUCEA), Universidad de Guadalajara, Guadalajara, Jalisco, México https://orcid.org/0000-0002-5682-3175

DOI:

https://doi.org/10.55965/setp.4.08.a3

Keywords:

ARIMA model, price forecast, corn prices, agricultural prices, Mexico

Abstract

Corn is an essential grain in the Mexican culinary, cultural and social heritage. However, the volatility in corn prices brings uncertainty to agricultural farmers and has caused an increase in imports of the grain from other countries. The purpose of this study is to use time-series models regularly applied in finance to an agricultural commodity and forecast corn prices in Mexico. The study employs autoregressive integrated moving average (ARIMA) models to forecast prices in 2024 and 2025 using data on average rural prices of grain corn from the period 1980 to 2023 The results contribute to a theoretical discussion on employing statistical tools to reduce market uncertainty on agricultural commodities and provide empirical practical results on corn prices for decision making. The results are innovative in using the ARIMA statistical tool to analyze a specific commodity (corn) in a specific market (Mexico). The conclusions of the study suggest an upward trend in corn prices for 2024 and 2025, however, price stagnation and uncertainty is observed. Although government policies have introduced price guarantees for corn in Mexico, they only cover less than 3% of total production. Future studies should analyze price divergence by regions or states in Mexico.

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Author Biography

Leo Guzmán-Anaya, Profesor Investigador en el Centro Universitario de Ciencias Económico-Administrativas (CUCEA), Universidad de Guadalajara, Guadalajara, Jalisco, México

Dr. Leo Guzman-Anaya is a research professor at the University Center of Economic and Managerial Science at the University of Guadalajara. He graduated at the bachelor’s level in International Business from the University of Guadalajara, earned a master’s degree in Economics from Tokyo International University, Japan, and a Ph.D. in Economics and Management Science with a specialization in Applied Economics from the University of Guadalajara.

He is a member of the National System of Researchers (Level 1). His research interests are oriented toward International Economics, with a particular interest in inter-industry spillovers and location determinants from Japanese foreign direct investment.

During his academic career, he has participated in 9 research projects at the intra and inter-institutional level, published one book, 11 book chapters, and 17 original research articles. He has presented research results at 30 international conferences and organized 11 international seminars. Furthermore, he has been invited to undertake academic stays at Sophia University and Seijo University in Japan. Also, he has been invited and consulted on topics related to Japanese investment in Mexico by government agencies such as JICA (Japan) and the Jalisco State Congress and by research centers, including The Brookings Institution (U.S.).

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