A Mathematical Model for Estimating Retail Price Movements of Basic Fruit and Vegetable Commodities Using Time Series Analysis

Prices of basic agricultural commodities in the market truly concern the entire populace in a region or country. They directly affect the consumers, farmers, traders, entrepreneurs, and even the government and policymakers. Developing a mathematical model in relation to the retail price movements of these basic agricultural commodities could possibly help every concerned individual with regard to economic matters as well as in planning the future. Specifically, the study included basic commodities such as fruits (banana and mango) and vegetables (tomato, cabbage, and pechay) in the National Capital Region (NCR) of the Philippines. The data were obtained from the Philippine Statistics Authority (PSA) in coverage of ten (10) years, from 2009 – 2018, while the time series modeling techniques used, were the ARIMA, SARIMA, and ARIMAx. After undertaking proper procedures and processes in developing the model, it was found that each of the commodities investigated in the study showed an increasing trend of monthly prices for a ten-year period (2009-2018). In terms of estimating the monthly retail prices of fruit commodities, ARIMAx (5, 2, 2, x=mango) emerged as the finest model for banana and ARIMAX (2, 2, 1, x=banana) for mango. For vegetable commodities, the best model to use for estimating monthly prices of cabbage was ARIMAX (3,2,1,x=pechay), SARIMA (1,1,1)(1,1,1)12 for pechay and SARIMA (2,1,1)(2,1,1)12 for tomatoes.