Mexican pork price forecast, based on WTI crude oil and Corn and Soybean grains
Abstract
The research conducted is correlational and studied the influence of the price of a barrel of WTI crude oil, a bushel of Corn and a ton of Soybean meal as independent variables, on the price of a pound of Mexican pork, with the objective of finding a function that explains these variations. Monthly average price data, collected over a 10–year period, from 01/10/2012 to 01/09/2022, were used. In the data there is a clear linear trend between the price of pork with the price of a barrel of WTI crude oil, and the price of a ton of soybean meal, but not so clear or evident with the price of a bushel of corn, being this variable excluded from the final model for being statistically not significant (Sig. 0.184). The independent variables of the final model are statistically significant (Sig. 0.000), with t–student values of 4.999 for WTI crude oil and 3.697 for soybean meal, and there are no collinearity problems between them. The model obtained is multiple linear regression, and has as predictors of pork price: the price of a barrel of WTI crude oil and the price of a ton of soybean meal . It predicts that the price of pork cannot fall below 15.50 US cents per pound, and can explain the variations of pork by 61.4%. The standardized residuals of the model present a normal distribution, corroborated by a Kolmogorov–Smirnov test of 0.071, there being a pair of positive extreme values, which can inform about the circumstances of the variables for the researcher's interest in the months of May and June 2021.
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