Multicriteria analysis of the variation in milk prices in Ecuador

Abstract

Ecuador's dairy sector is one of the country's main productive forces, contributing to the increase in the Gross Domestic Product and generating around 1.2 million jobs. This sector has been crucial to economic and social progress since 1900, but the price of milk has also been affected by extreme weather events and fluctuations in agricultural input prices. The COVID-19 pandemic exacerbated these difficulties by causing economic instability, an increase in initial sales followed by a reduction in production due to labor and transportation restrictions. Carchi, a high-performance province in milk production, faces additional problems due to the smuggling of Colombian milk, which reduces prices and negatively affects dairy producers and microentrepreneurs. Illegal trade encourages the informal manufacturing of dairy products, complicating the economic stability of producers. To address these problems, the study has proposed using multi-criteria methods, specifically the Neutrosophic Hierarchical Analytical Process (NAHP), to evaluate the factors that influence the variation in milk price and its impact on dairy microenterprises. The NAHP method will allow the analysis of various criteria, such as production costs, profit margin, customer demand, market competitiveness, financial sustainability and product quality, with the aim of identifying effective strategies to face the current and future challenges of the sector.

Keywords:

Milk, NAHP, Consumers, Production, National economy.