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A new approach is provided in our paper for creating a strategic early warning system allowing the estimation of the future state of the milk market as scenarios. This is in line with the recent call from the EU commission for tools that help to better address such a highly volatile market. We applied different multivariate time series regression and Bayesian networks on a pre-determined map of relations between macro-economic indicators. The evaluation of our findings with root mean square error (RMSE) performance score enhances the robustness of the prediction model constructed. Our model could be used by competitive intelligence teams to obtain sharper scenarios, leading companies and public organisations to better anticipate market changes and make more robust decisions.

A Bayesian approach to developing a strategic early warning system for the French milk market