Forecasting the Impact of the COVID-19 Outbreak on China’s Cotton Exports by Modified Discrete Grey Model with Limited Data

Abstract

The sudden outbreak of COVID-19 has created dramatic challenges for public health and textile export trade worldwide. Such abrupt changes are difficult to predict due to the inherently high complexity and nonlinearity, especially with limited data. This article proposes a novel modified discrete grey model with weakening buffer operators, called BODGM (1,1), for forecasting the impact of pandemic-induced uncertainty on the volatility of cotton exports in China under limited samples. First, the Mann–Kendall test examines how pandemic-induced uncertainty affects cotton exports, based on China’s monthly cotton export data from June 2014 to August 2022. Second, buffer operators are employed to weaken the nonlinear trends and correct the tentative predictions of the discrete grey model. Then, the BODGM (1,1) model was validated by comparison with four alternative models. The results indicate that the BODGM (1,1) model was particularly promising for identifying mutational fluctuations in cotton exports and outperformed the GM (1,1), DGM (1,1), ARIMA and linear regression models in fitting and prediction accuracy under volatility and limited data. The BODGM (1,1) model forecast results for China showed that cotton export volume was expected to show signs of recovery over the next 12 months. The findings of this study may provide a basis for formulating trade policies to mitigate the impact of the COVID-19 outbreak on export resources and build their resilience to future pandemics.