Satellite is Used to Forecast Production and Sales

As part of a growing trend among hedge funds, surveillance is being used to gather market-moving information. It is early warning or information system about the performance of the business. There are two surprising facts about how production and business performance can be forecasted.

First, on August 6, 2010 Russian government announced it was shutting down the grain exports because of production are going to decline in Russia.At the same time, Lanworth Inc. a private firm was ready to announce its forecast the food grain production in Russia. It informed its customers that it guessed the Russians would only be able to produce 45.6 million tons of wheat this year.

How they forecast the production of agricultural product? Satellite has been used to estimate the production of agricultural crops. An analytical firm Lanworth Inc. scrutinized satellite images of Russia to measure wheat production. “Using infrared and microwave images of the entire planet taken twice a day, Lanworth can distinguish between each type of corn, soybeans, wheat and on and on—and discover the total number of acres of each planted overall. Infrared images capture the chlorophyll in the plants, and microwave images pick up the degree of moisture in the crops.” It monitors the health of those acres over time; analysts can spot any changes that can affect supply of commodities in the markets: diseases, floods, fires and other agricultural calamities.

Second, by counting the cars in Wal-Mart’s parking lots month in and month out, ‘Remote Sensing Metrics’ analysts were able to get a fix on the company’s customer flow. From there, they worked up a mathematical regression to come up with a prediction of the company’s quarterly revenue each month.

Details can found Here & Here