Forecasting The Production of Crude Palm Oil (CPO) in Indonesia 2022 using the Grey(1.1) Model

Abstract

Crude Palm Oil (CPO) is a vegetable oil produced from oil palm fruit plants. Palm oil can be used for many things, including for various foods, cosmetics, hygiene products, and can also be used as a source of biofuel or biodiesel. Indonesia is a country with the most CPO production in the world. However, the development of CPO production must be appropriately managed to meet demand from other countries. Therefore, this study aims to predict CPO production in 2022. One of the appropriate statistical methods is the Grey(1.1) model. This model was chosen based on the availability of CPO production data by the Central Statistics Agency, which only presents annual data from 2017 - 2021. So, the number of observations that can be used to predict CPO production in Indonesia is only five observations. The Grey(1.1) model can cover problems in the availability of small amounts of data. There are three main steps in the modelling procedure with Grey(1,1) model, namely forming an Accumulated Generated Operation (AGO) sequence, then forming a Mean Generating Operation (MGO) sequence, and the last step is a prediction with Inverse AGO (1-AGO). This study obtained the 1-AGO sequence on the Grey(1.1) model for CPO production in Indonesia with outstanding accuracy, namely the Mean Absolute Percentage Error (MAPE) value of 0.01%. In addition, a prediction of CPO production in Indonesia for 2022 is made, which is 52590612.99 (an increase of 2339783.668 from 2021).