Determined parameters.
\\n\\n
IntechOpen was founded by scientists, for scientists, in order to make book publishing accessible around the globe. Over the last two decades, this has driven Open Access (OA) book publishing whilst levelling the playing field for global academics. Through our innovative publishing model and the support of the research community, we have now published over 5,700 Open Access books and are visited online by over three million academics every month. These researchers are increasingly working in broad technology-based subjects, driving multidisciplinary academic endeavours into human health, environment, and technology.
\\n\\nBy listening to our community, and in order to serve these rapidly growing areas which lie at the core of IntechOpen's expertise, we are launching a portfolio of Open Science journals:
\\n\\nAll three journals will publish under an Open Access model and embrace Open Science policies to help support the changing needs of academics in these fast-moving research areas. There will be direct links to preprint servers and data repositories, allowing full reproducibility and rapid dissemination of published papers to help accelerate the pace of research. Each journal has renowned Editors in Chief who will work alongside a global Editorial Board, delivering robust single-blind peer review. Supported by our internal editorial teams, this will ensure our authors will receive a quick, user-friendly, and personalised publishing experience.
\\n\\n"By launching our journals portfolio we are introducing new, dedicated homes for interdisciplinary technology-focused researchers to publish their work, whilst embracing Open Science and creating a unique global home for academics to disseminate their work. We are taking a leap toward Open Science continuing and expanding our fundamental commitment to openly sharing scientific research across the world, making it available for the benefit of all." Dr. Sara Uhac, IntechOpen CEO
\\n\\n"Our aim is to promote and create better science for a better world by increasing access to information and the latest scientific developments to all scientists, innovators, entrepreneurs and students and give them the opportunity to learn, observe and contribute to knowledge creation. Open Science promotes a swifter path from research to innovation to produce new products and services." Alex Lazinica, IntechOpen founder
\\n\\nIn conclusion, Natalia Reinic Babic, Head of Journal Publishing and Open Science at IntechOpen adds:
\\n\\n“On behalf of the journal team I’d like to thank all our Editors in Chief, Editorial Boards, internal supporting teams, and our scientific community for their continuous support in making this portfolio a reality - we couldn’t have done it without you! With your support in place, we are confident these journals will become as impactful and successful as our book publishing program and bring us closer to a more open (science) future.”
\\n\\nWe invite you to visit the journals homepage and learn more about the journal’s Editorial Boards, scope and vision as all three journals are now open for submissions.
\\n\\nFeel free to share this news on social media and help us mark this memorable moment!
\\n\\n\\n"}]',published:!0,mainMedia:{caption:"",originalUrl:"/media/original/237"}},components:[{type:"htmlEditorComponent",content:'
After years of being acknowledged as the world's leading publisher of Open Access books, today, we are proud to announce we’ve successfully launched a portfolio of Open Science journals covering rapidly expanding areas of interdisciplinary research.
\n\n\n\nIntechOpen was founded by scientists, for scientists, in order to make book publishing accessible around the globe. Over the last two decades, this has driven Open Access (OA) book publishing whilst levelling the playing field for global academics. Through our innovative publishing model and the support of the research community, we have now published over 5,700 Open Access books and are visited online by over three million academics every month. These researchers are increasingly working in broad technology-based subjects, driving multidisciplinary academic endeavours into human health, environment, and technology.
\n\nBy listening to our community, and in order to serve these rapidly growing areas which lie at the core of IntechOpen's expertise, we are launching a portfolio of Open Science journals:
\n\nAll three journals will publish under an Open Access model and embrace Open Science policies to help support the changing needs of academics in these fast-moving research areas. There will be direct links to preprint servers and data repositories, allowing full reproducibility and rapid dissemination of published papers to help accelerate the pace of research. Each journal has renowned Editors in Chief who will work alongside a global Editorial Board, delivering robust single-blind peer review. Supported by our internal editorial teams, this will ensure our authors will receive a quick, user-friendly, and personalised publishing experience.
\n\n"By launching our journals portfolio we are introducing new, dedicated homes for interdisciplinary technology-focused researchers to publish their work, whilst embracing Open Science and creating a unique global home for academics to disseminate their work. We are taking a leap toward Open Science continuing and expanding our fundamental commitment to openly sharing scientific research across the world, making it available for the benefit of all." Dr. Sara Uhac, IntechOpen CEO
\n\n"Our aim is to promote and create better science for a better world by increasing access to information and the latest scientific developments to all scientists, innovators, entrepreneurs and students and give them the opportunity to learn, observe and contribute to knowledge creation. Open Science promotes a swifter path from research to innovation to produce new products and services." Alex Lazinica, IntechOpen founder
\n\nIn conclusion, Natalia Reinic Babic, Head of Journal Publishing and Open Science at IntechOpen adds:
\n\n“On behalf of the journal team I’d like to thank all our Editors in Chief, Editorial Boards, internal supporting teams, and our scientific community for their continuous support in making this portfolio a reality - we couldn’t have done it without you! With your support in place, we are confident these journals will become as impactful and successful as our book publishing program and bring us closer to a more open (science) future.”
\n\nWe invite you to visit the journals homepage and learn more about the journal’s Editorial Boards, scope and vision as all three journals are now open for submissions.
\n\nFeel free to share this news on social media and help us mark this memorable moment!
\n\n\n'}],latestNews:[{slug:"intechopen-supports-asapbio-s-new-initiative-publish-your-reviews-20220729",title:"IntechOpen Supports ASAPbio’s New Initiative Publish Your Reviews"},{slug:"webinar-introduction-to-open-science-wednesday-18-may-1-pm-cest-20220518",title:"Webinar: Introduction to Open Science | Wednesday 18 May, 1 PM CEST"},{slug:"step-in-the-right-direction-intechopen-launches-a-portfolio-of-open-science-journals-20220414",title:"Step in the Right Direction: IntechOpen Launches a Portfolio of Open Science Journals"},{slug:"let-s-meet-at-london-book-fair-5-7-april-2022-olympia-london-20220321",title:"Let’s meet at London Book Fair, 5-7 April 2022, Olympia London"},{slug:"50-books-published-as-part-of-intechopen-and-knowledge-unlatched-ku-collaboration-20220316",title:"50 Books published as part of IntechOpen and Knowledge Unlatched (KU) Collaboration"},{slug:"intechopen-joins-the-united-nations-sustainable-development-goals-publishers-compact-20221702",title:"IntechOpen joins the United Nations Sustainable Development Goals Publishers Compact"},{slug:"intechopen-signs-exclusive-representation-agreement-with-lsr-libros-servicios-y-representaciones-s-a-de-c-v-20211123",title:"IntechOpen Signs Exclusive Representation Agreement with LSR Libros Servicios y Representaciones S.A. de C.V"},{slug:"intechopen-expands-partnership-with-research4life-20211110",title:"IntechOpen Expands Partnership with Research4Life"}]},book:{item:{type:"book",id:"4694",leadTitle:null,fullTitle:"Thermoplastic Elastomers - Synthesis and Applications",title:"Thermoplastic Elastomers",subtitle:"Synthesis and Applications",reviewType:"peer-reviewed",abstract:"Thermoplastic elastomers (TPEs), commonly known as thermoplastic rubbers, are a category of copolymers having thermoplastic and elastomeric characteristics. A TPE is a rubbery material with properties very close to those of conventional vulcanized rubber at normal conditions. It can be processed in a molten state even at elevated temperatures. TPEs show advantages typical of both rubbery materials and plastic materials. TPEs are a class of polymers bridging between the service properties of elastomers and the processing properties of thermoplastics. Nowadays, the best use of thermoplastics is in the field of biomedical applications, starting from artificial skin to many of the artificial human body parts. Apart from these, thermoplastic elastomers are being used for drug encapsulation purposes, and since they are biocompatible in many cases, their scope of applications has been broadened in the biotechnological field as well. The present book highlights many biological and biomedical applications of TPEs from which the broader area readers will benefit.",isbn:null,printIsbn:"978-953-51-2223-4",pdfIsbn:"978-953-51-6643-6",doi:"10.5772/59647",price:119,priceEur:129,priceUsd:155,slug:"thermoplastic-elastomers-synthesis-and-applications",numberOfPages:178,isOpenForSubmission:!1,isInWos:null,isInBkci:!1,hash:"c3ec02a814af3a9d5b35090169290549",bookSignature:"Chapal Kumar Das",publishedDate:"November 26th 2015",coverURL:"https://cdn.intechopen.com/books/images_new/4694.jpg",numberOfDownloads:16859,numberOfWosCitations:12,numberOfCrossrefCitations:12,numberOfCrossrefCitationsByBook:2,numberOfDimensionsCitations:19,numberOfDimensionsCitationsByBook:3,hasAltmetrics:1,numberOfTotalCitations:43,isAvailableForWebshopOrdering:!0,dateEndFirstStepPublish:"November 13th 2014",dateEndSecondStepPublish:"December 4th 2014",dateEndThirdStepPublish:"March 2nd 2015",dateEndFourthStepPublish:"April 1st 2015",dateEndFifthStepPublish:"May 1st 2015",currentStepOfPublishingProcess:5,indexedIn:"1,2,3,4,5,6,7",editedByType:"Edited by",kuFlag:!1,featuredMarkup:null,editors:[{id:"175797",title:"Dr.",name:"Chapal",middleName:null,surname:"Kumar Das",slug:"chapal-kumar-das",fullName:"Chapal Kumar Das",profilePictureURL:"https://mts.intechopen.com/storage/users/175797/images/4412_n.jpg",biography:"Professor Chapal Kumar Das is a professor at the Materials Science Centre, IIT Kharagpur, India. He has received his Ph.D. from the same institute. He has both industrial and academic experience. His research interest lies in the fields of polymer blends and alloys, high-performance composites based on LCP, self-reinforcing elastomers, nano-polymer composites, devulcanization of scrap tires, direct fluorination of plastics, flexible engineering composites for defense applications, short Kevlar fiber composites based on thermoplastics, carbon nanotube–polymer composites, modification of nanofillers, welding of thermoplastic nanocomposites, and elastomeric thin films. His present research interest is in the development of supercapacitors, high-power microwave-absorbing materials, and fuel and solar cells. He has contributed 15 scientific chapters in books and encyclopedias. He has completed 17 high-value projects. He has supervised 32 Ph.D. students and 36 M.Tech./M.S. students. He has published about 370 papers in international journals and about 40 papers in national journals. He has travelled widely throughout various countries for different collaborative projects and international conferences. He served as the Head of the Materials Science Centre, IIT Kharagpur. He is the recipient of the Lady Davis fellowship, Israel. He is a fellow of IRI and a life member of MRSI and the Polymer Society.",institutionString:null,position:null,outsideEditionCount:0,totalCites:0,totalAuthoredChapters:"0",totalChapterViews:"0",totalEditedBooks:"1",institution:null}],equalEditorOne:null,equalEditorTwo:null,equalEditorThree:null,coeditorOne:null,coeditorTwo:null,coeditorThree:null,coeditorFour:null,coeditorFive:null,topics:[{id:"915",title:"Polymers",slug:"materials-science-biochemistry-polymers"}],chapters:[{id:"48808",title:"Synthesis and Properties of Polyurethanes Based on Synthetic Polyhydroxybutyrate for Medical Application",doi:"10.5772/60933",slug:"synthesis-and-properties-of-polyurethanes-based-on-synthetic-polyhydroxybutyrate-for-medical-applica",totalDownloads:1657,totalCrossrefCites:1,totalDimensionsCites:2,hasAltmetrics:0,abstract:"Polyurethanes is a group of polymers whose unique properties make them useful in both the construction and the textile industry, and even in tissue engineering. One small, but very significant, urethane group connects specially selected macrochains to obtain a material with established properties.",signatures:"Joanna Brzeska",downloadPdfUrl:"/chapter/pdf-download/48808",previewPdfUrl:"/chapter/pdf-preview/48808",authors:[{id:"175187",title:"Dr.",name:"Brzeska",surname:"Joanna",slug:"brzeska-joanna",fullName:"Brzeska Joanna"}],corrections:null},{id:"48873",title:"Synthesis and Properties of Multiblock Terpoly(Ester-Aliphatic- Amide) and Terpoly(Ester-Ether-Amide) Thermoplastic Elastomers with Various Chemical Compositions of Ester Block",doi:"10.5772/61215",slug:"synthesis-and-properties-of-multiblock-terpoly-ester-aliphatic-amide-and-terpoly-ester-ether-amide-t",totalDownloads:1784,totalCrossrefCites:1,totalDimensionsCites:1,hasAltmetrics:0,abstract:"Two series of thermoplastic elastomers with various chemical compositions of ester block were prepared via the reaction of α,ω-dicarboxylic oligo(laurolactam) (PA12, Mw≈2000 g/mol) with oligo(oxytetramethylene)diol (PTMO, Mw≈1000 g/mol) or linoleic alcohol dimer (DLAol) and with dimethyl terephthalate and a low molecular weight glycol (forming during the synthesis of the ester block). The degree of polycondensation (DPGT) of poly(multi-methylene terephtalate) equals to DPGT=2. The influence of the number of carbons separating the terephtalate groups, as well as the effect of meta- or para- positions of the ester groups in the benzene ring of other blocks, on the synthesis, properties and structure of these elastomers have been evaluated. A nuclear magnetic resonance spectroscopy to carbon (13C NMR) and Fourier transform infrared spectroscopy (FT-IR) were used to confirm their assumed chemical structure. The influence of chemical compositions of ester block on the functional properties and on the values of phase transition temperatures of the products have been determined. The thermal properties and the phase separation of obtained systems were defined by differential scanning calorimetry (DSC), dynamic mechanical thermal analysis (DMTA), wide-angle x-ray diffraction (WAXS) and other standard physical methods. The mechanical and elastic properties of obtained polymers were evaluated.",signatures:"Joanna Rokicka and Ryszard Ukielski",downloadPdfUrl:"/chapter/pdf-download/48873",previewPdfUrl:"/chapter/pdf-preview/48873",authors:[{id:"175227",title:"M.Sc.",name:"Joanna",surname:"Rokicka",slug:"joanna-rokicka",fullName:"Joanna Rokicka"},{id:"175248",title:"Prof.",name:"Ryszard",surname:"Ukielski",slug:"ryszard-ukielski",fullName:"Ryszard Ukielski"}],corrections:null},{id:"49213",title:"Plasticization and Morphology Development in Dynamically Vulcanized Thermoplastic Elastomers",doi:"10.5772/61414",slug:"plasticization-and-morphology-development-in-dynamically-vulcanized-thermoplastic-elastomers",totalDownloads:1899,totalCrossrefCites:0,totalDimensionsCites:1,hasAltmetrics:0,abstract:"Dynamically vulcanized thermoplastic elastomers constitute one of the main categories among various types of thermoplastic elastomers (TPEs). Due to the commercial importance of this particular group of TPEs, tremendous efforts have been dedicated to improve the understanding and control the phase morphology development. The ultimate goal is to obtain materials with improved physical and mechanical properties. As in other polymeric compounds, the parameters during the mixing stage have a significant influence on the final morphology of dynamically vulcanized blends. Furthermore, the phase morphology and, therefore, the distribution of elastomeric domains in the thermoplastic phase are also strongly dependent on the formulation. This chapter discusses the main important processing factors and, more specifically, highlights the effects of plasticization and curing on the morphology development of dynamically vulcanized thermoplastic elastomer blends. The following text provides fundamental information on how one should take into consideration each parameter affecting the morphology of nonreactive and reactive elastomer/thermoplastic blends.",signatures:"Shant Shahbikian and Pierre J. Carreau",downloadPdfUrl:"/chapter/pdf-download/49213",previewPdfUrl:"/chapter/pdf-preview/49213",authors:[{id:"175099",title:"Emeritus Prof.",name:"Pierre",surname:"Carreau",slug:"pierre-carreau",fullName:"Pierre Carreau"},{id:"363802",title:"Dr.",name:"Shant",surname:"Shahbikian",slug:"shant-shahbikian",fullName:"Shant Shahbikian"}],corrections:null},{id:"48870",title:"Environmental Degradability of Polyurethanes",doi:"10.5772/60925",slug:"environmental-degradability-of-polyurethanes",totalDownloads:2751,totalCrossrefCites:6,totalDimensionsCites:10,hasAltmetrics:1,abstract:"The growing interest in environmental issues and increasing demands to develop materials that do not burden the natural environment significantly are currently observed. In this connection many studies on polymer degradation in different environments are carried out. It is important to consider the influence of synergistic action of various factors in order to understand the environmental degradation of synthetic polymers. This requires understanding of interactions between polymer and living organisms.",signatures:"Katarzyna Krasowska, Aleksandra Heimowska and Maria\nRutkowska",downloadPdfUrl:"/chapter/pdf-download/48870",previewPdfUrl:"/chapter/pdf-preview/48870",authors:[{id:"175012",title:"Prof.",name:"Maria",surname:"Rutkowska",slug:"maria-rutkowska",fullName:"Maria Rutkowska"},{id:"175013",title:"Dr.",name:"Katarzyna",surname:"Krasowska",slug:"katarzyna-krasowska",fullName:"Katarzyna Krasowska"},{id:"175186",title:"Dr.",name:"Heimowska",surname:"Aleksandra",slug:"heimowska-aleksandra",fullName:"Heimowska Aleksandra"}],corrections:null},{id:"49439",title:"Heat sensing Thermoplastic Elastomer Based on Polyolefins for Encapsulation Applications",doi:"10.5772/61691",slug:"heat-sensing-thermoplastic-elastomer-based-on-polyolefins-for-encapsulation-applications",totalDownloads:2096,totalCrossrefCites:2,totalDimensionsCites:2,hasAltmetrics:0,abstract:"Use of Thermoplastic Elastomers (TPEs) has become a unique pathway to meet the daily requirements of various applications. The ease of using TPEs lies in the fact that they provide both the character of the individual properties as they are constructional polymers, which are physically crosslinked materials made up of a thermoplastic and an elastomer. There are several TPE’s in market and individual have several outstanding performances. Out of several researches, our aim in this article is to focus on the influence of Polyolefin based TPE’s. This paper focusses on the different aspects of TPO’s their physical, chemical, mechanical, and electrical characteristics, advantages and uses of these materials along with a particular focus on their use in encapsulation application. Factors that could affect the end use are also explained here in details. Heat shrinkability test, cure time, and SEM are some of the characterisations used to demonstrate the exact criteria of polyolefin based TPE’s for encapsulation application.",signatures:"Tanya Das and Sunanda Roy",downloadPdfUrl:"/chapter/pdf-download/49439",previewPdfUrl:"/chapter/pdf-preview/49439",authors:[{id:"176213",title:"Dr.",name:"Tanya",surname:"Das",slug:"tanya-das",fullName:"Tanya Das"},{id:"363885",title:"Dr.",name:"Sunanda",surname:"Roy",slug:"sunanda-roy",fullName:"Sunanda Roy"}],corrections:null},{id:"48857",title:"Thermoplastic Elastomers with Photo-actuating Properties",doi:"10.5772/60945",slug:"thermoplastic-elastomers-with-photo-actuating-properties",totalDownloads:2140,totalCrossrefCites:0,totalDimensionsCites:0,hasAltmetrics:0,abstract:"This contribution reviews elastomeric materials with photo-actuation behavior with emphasis on thermoplastic elastomers and their composites. The principles of the photo-actuation and the main factors affecting the photo-actuation phenomena of thermoplastic elastomer materials are discussed in detail. The well-performing photo-actuating systems involving both statistical and block copolymers-based thermoplastic elastomers are assessed in terms of their advantages and limitations. Methods for evaluation of photo-actuation behavior of the materials are reported as well. 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The goals of the paper present review of option pricing models illustrated in both the binomial and the Black-Scholes models. In the paper, it generally divides option pricing part and part of binomial model and the Black-Scholes model. The first section presents option pricing theory and models. The second section describes the binomial option pricing model. The third section is about the Black-Scholes model. The last section is the conclusion.
An option provides the holder with the right to buy or sell a specified quantity of an underlying asset at the exercise price on or before the expiration date of the option. Since it is a right and not an obligation, the holder can choose not to exercise the right and allow the option to expire. According to that summarizes the options, variables increasing with the effect of call/put option prices:
Underlying asset’s price: increase of call price and decrease of put price.
Exercise pricing: decrease of call price and increase of put price.
Variance of underlying asset: both increases of call and put prices.
Time to expiration: both increases of call and put prices.
Interest rates: increase of call price and decrease of put price.
Dividends paid: decrease of call price and increase of put price.
Option pricing theory has made vast strides since 1972, when Black and Scholes published paper “the pricing of options and corporate liabilities” in the Journal of Political Economy. Black and Scholes used a “replicating portfolio”: a portfolio constituted the underlying asset and the risk-free asset, and they had the same cash flows as the option being valued of final formulation. However, the mathematical derivation is complicated, although binomial model is simpler for options valuation with same logic.
The binomial option pricing model depends on a simple formulation for the asset price process in any time period can move to one of two possible prices. Suppose an investor focuses estimates on how stock prices change between sub periods, rather than on the dollar levels. That is, beginning with stock price, for the next sub period forecasts:
first is 1+% change for an up movement(
second is 1+% change for a down movement(
Additional, to the point of accumulation, the number of requisite forecasts. Assume that the same values for up movement and down movement apply to price change in all subsequent sub period. Under these assumptions, the investor need only forecast up movement, down movement, and N-the total number of sub periods.
The binomial option pricing model consists of the forecasted stock price and option value trees. The upper panel presents after
Hence, the formula for an option in sub period
where
SPDR S&P 500 ETF Trust (SPY) is an exchange-traded fund. The trust corresponds to the price and yield performance of the S&P 500 Index. The S&P 500 Index is composed of 500 selected stocks and spans over 24 separate industry groups. The Fund’s investment sectors include information technology, financials, energy, health care, consumer staples, industrials, consumer discretionary, materials, utilities, and telecommunication services.
Suppose that the riskless rate r is 10% p.a., the time to maturity T is 0.5 year, the initial price of the underlying asset is 134.76 m.u., the volatility σ = 18.06% p.a., the exercise price X is 70.26 m.u. It is also supposed that the time interval T is split into n = 1000 subintervals of equal length.
Task is to determine the price of the European call option on the basis of the multi period binomial model. Illustrate the probability distribution for both, the underlying asset price and the intrinsic value at maturity T graphically.
Following Table 1 presents input data of determined parameters.
Risk-less rate, r | Number of steps, n | Time to maturity, T | Initial underlying asset price, S0 | Exercise price, X | Volatility, σ | Up-ratio, μ | Down-ratio, d | Probability, p | Discount factor, df |
---|---|---|---|---|---|---|---|---|---|
10% | 1000 | 0.5 | 134.76 | 70.26 | 18.06% | 1.004046504 | 0.995969804 | 0.505181219 | 0.951230613 |
Determined parameters.
First step (Table 2) to calculate the probabilities for a state j (using the sample of number 30)
Up movements | Probability | Stock price | Intrinsic value | Product |
---|---|---|---|---|
0 | 0.0000 | 66.9559 | 0.0000 | 0.0000 |
1 | 0.0000 | 70.1521 | 0.0000 | 0.0000 |
2 | 0.0000 | 73.5008 | 3.2408 | 0.0000 |
3 | 0.0000 | 77.0093 | 6.7493 | 0.0000 |
4 | 0.0000 | 80.6854 | 10.4254 | 0.0001 |
5 | 0.0000 | 84.5369 | 14.2769 | 0.0005 |
6 | 0.0002 | 88.5723 | 18.3123 | 0.0033 |
7 | 0.0007 | 92.8003 | 22.5403 | 0.0155 |
8 | 0.0022 | 97.2301 | 26.9701 | 0.0602 |
9 | 0.0061 | 101.8714 | 31.6114 | 0.1944 |
10 | 0.0146 | 106.7342 | 36.4742 | 0.5310 |
11 | 0.0298 | 111.8292 | 41.5692 | 1.2405 |
12 | 0.0533 | 117.1674 | 46.9074 | 2.4986 |
13 | 0.0832 | 122.7603 | 52.5003 | 4.3654 |
14 | 0.1138 | 128.6203 | 58.3603 | 6.6432 |
15 | 0.1369 | 134.7600 | 64.5000 | 8.8292 |
16 | 0.1447 | 141.1928 | 70.9328 | 10.2625 |
17 | 0.1343 | 147.9326 | 77.6726 | 10.4334 |
18 | 0.1094 | 154.9942 | 84.7342 | 9.2674 |
19 | 0.0779 | 162.3928 | 92.1328 | 7.1749 |
20 | 0.0483 | 170.1447 | 99.8847 | 4.8232 |
21 | 0.0259 | 178.2665 | 108.0065 | 2.7999 |
22 | 0.0120 | 186.7761 | 116.5161 | 1.3931 |
23 | 0.0047 | 195.6918 | 125.4318 | 0.5881 |
24 | 0.0015 | 205.0332 | 134.7732 | 0.2078 |
25 | 0.0004 | 214.8205 | 144.5605 | 0.0603 |
26 | 0.0001 | 225.0749 | 154.8149 | 0.0140 |
27 | 0.0000 | 235.8189 | 165.5589 | 0.0025 |
28 | 0.0000 | 247.0757 | 176.8157 | 0.0003 |
29 | 0.0000 | 258.8699 | 188.6099 | 0.0000 |
30 | 0.0000 | 271.2270 | 200.9670 | 0.0000 |
sum | 1.00 | 71.4093 |
Calculation of probabilities, stock price, intrinsic value, and product.
Finally, the option price calculated by discounting the mean value of the intrinsic value, the result of option price is 68 m.u. Following Figure 1 shows illustration depicts that the probability distribution for both, the stock price and the intrinsic value of the option at maturity time.
Probability distribution.
The Black-Scholes model assumes that a statistical process known as geometric Brownian motion can describe stock price movements. This statistical process summarized by a volatility factor
Hence, the equation presents stock’s return (∆
Assuming Black and Scholes used the riskless hedge to get the following formula for no dividend-paying stock call option valuation:
where
The variable
positive values of
negative values of
The option’s value is a function of five variables, there are current security price (S), exercise price (X), time to expiration (T), risk-free rate (RFR), and security price volatility (
Suppose that known all parameters that are needed to apply the Black-Scholes model, r, S0, dt, X, and σ. All input data are shown in Table 3.
Options | Riskless rate | S0 | dt | σ | X |
---|---|---|---|---|---|
Option 1 | 0.1 | 134.76 | 0.5 | 18.060% | 70.26 |
Option 2 | 0.1 | 134.76 | 0.5 | 21.060% | 80.26 |
Option 3 | 0.1 | 134.76 | 0.5 | 24.060% | 90.26 |
Option 4 | 0.1 | 134.76 | 0.5 | 27.060% | 100.26 |
Option 5 | 0.1 | 134.76 | 0.5 | 30.060% | 110.26 |
Option 6 | 0.1 | 134.76 | 0.5 | 33.060% | 120.26 |
Option 7 | 0.1 | 134.76 | 0.5 | 36.060% | 130.26 |
Option 8 | 0.1 | 134.76 | 0.5 | 39.060% | 140.26 |
Option 9 | 0.1 | 134.76 | 0.5 | 42.060% | 150.26 |
Option 10 | 0.1 | 134.76 | 0.5 | 45.060% | 160.26 |
Option 11 | 0.1 | 134.76 | 0.5 | 48.060% | 170.26 |
Option 12 | 0.1 | 134.76 | 0.5 | 51.060% | 180.26 |
Option 13 | 0.1 | 134.76 | 0.5 | 54.060% | 190.26 |
Option 14 | 0.1 | 134.76 | 0.5 | 57.060% | 200.26 |
Option 15 | 0.1 | 134.76 | 0.5 | 60.060% | 210.26 |
Option 16 | 0.1 | 134.76 | 0.5 | 63.060% | 220.26 |
Option 17 | 0.1 | 134.76 | 0.5 | 66.060% | 230.26 |
Option 18 | 0.1 | 134.76 | 0.5 | 69.060% | 240.26 |
Option 19 | 0.1 | 134.76 | 0.5 | 72.060% | 250.26 |
Option 20 | 0.1 | 134.76 | 0.5 | 75.060% | 260.26 |
Input data.
Task is to determine the price of the European call option on the Black-Scholes model.
First step to calculate the prices of options. Following Table 4 presents the procedure of prices of options.
d1 | d2 | N(d1) | N(−d1) | N(d2) | N(−d2) |
---|---|---|---|---|---|
2.7777 | 2.6500 | 0.9973 | 0.0027 | 0.9960 | 0.0040 |
1.9451 | 1.7962 | 0.9741 | 0.0259 | 0.9638 | 0.0362 |
1.3674 | 1.1973 | 0.9143 | 0.0857 | 0.8844 | 0.1156 |
0.9513 | 0.7599 | 0.8293 | 0.1707 | 0.7763 | 0.2237 |
0.6428 | 0.4302 | 0.7398 | 0.2602 | 0.6665 | 0.3335 |
0.4089 | 0.1751 | 0.6587 | 0.3413 | 0.5695 | 0.4305 |
0.2284 | −0.0266 | 0.5903 | 0.4097 | 0.4894 | 0.5106 |
0.0871 | −0.1890 | 0.5347 | 0.4653 | 0.4250 | 0.5750 |
−0.0246 | −0.3220 | 0.4902 | 0.5098 | 0.3737 | 0.6263 |
−0.1138 | −0.4325 | 0.4547 | 0.5453 | 0.3327 | 0.6673 |
−0.1855 | −0.5253 | 0.4264 | 0.5736 | 0.2997 | 0.7003 |
−0.2434 | −0.6044 | 0.4039 | 0.5961 | 0.2728 | 0.7272 |
−0.2902 | −0.6724 | 0.3858 | 0.6142 | 0.2507 | 0.7493 |
−0.3281 | −0.7315 | 0.3714 | 0.6286 | 0.2322 | 0.7678 |
−0.3587 | −0.7834 | 0.3599 | 0.6401 | 0.2167 | 0.7833 |
−0.3834 | −0.8293 | 0.3507 | 0.6493 | 0.2035 | 0.7965 |
−0.4031 | −0.8702 | 0.3434 | 0.6566 | 0.1921 | 0.8079 |
−0.4188 | −0.9071 | 0.3377 | 0.6623 | 0.1822 | 0.8178 |
−0.4310 | −0.9405 | 0.3332 | 0.6668 | 0.1735 | 0.8265 |
−0.4403 | −0.9710 | 0.3299 | 0.6701 | 0.1658 | 0.8342 |
Procedure of prices of options (a).
Following Table 5 and Figure 2 describe the result of options prices.
Options | Call option |
---|---|
Option 1 | 67.8267 |
Option 2 | 57.6927 |
Option 3 | 47.2716 |
Option 4 | 37.7111 |
Option 5 | 29.7951 |
Option 6 | 23.6162 |
Option 7 | 18.9135 |
Option 8 | 15.3523 |
Option 9 | 12.6407 |
Option 10 | 10.5544 |
Option 11 | 8.9299 |
Option 12 | 7.6504 |
Option 13 | 6.6325 |
Option 14 | 5.8168 |
Option 15 | 5.1603 |
Option 16 | 4.6318 |
Option 17 | 4.2081 |
Option 18 | 3.8721 |
Option 19 | 3.6109 |
Option 20 | 3.4145 |
Options prices.
Dependency of a call option price on an exercise price.
The number of steps affects the option price and the price determined by the binomial model converges to the analytical solution of the Black-Scholes model. Then we will get the options prices to compare with Black-Scholes model and binomial model in different number of steps. It is easy to see that the result of binomial model is around by the continuous time of Black-Scholes model. Following Figure 3 presents verification of options prices between two models, the results of number of steps will be select by sample.
Verification of applying prices of European options using binomial model and Black-Scholes model.
When the process is continuous, the binomial model for pricing options coverages on the Black-Scholes model. The advantage of the Black-Scholes approach:
riskless hedge method leads to a relatively simple,
closed-form equation capable of valuing options accurately under extensive situation.
This paper presents two classic option pricing model and illustrated the binomial model and the Black-Scholes model based on the same theoretical foundations and assumptions (such as the geometric Brownian motion theory of stock price behavior and risk-neutral valuation). The Black-Scholes option pricing model is the first successful option pricing model, published in 1973, and is based on stochastic calculus. It focuses on the pricing of European options, in which the underlying does not pay a dividend in the option period. The option is priced according to the value of the underlying, the volatility of the value of the underlying, the exercise price, the time to maturity, and the risk-free rate of interest. The model provided a general approach to option pricing and has given rise to a number of other option pricing models. The same underlying assumptions regarding stock prices underpin both the binomial and Black-Scholes models: that stock prices follow a stochastic process described by geometric Brownian motion. As a result, for European options, the binomial model converges on the Black-Scholes formula as the number of binomial calculation steps increases. In fact, the Black-Scholes model for European options is really a special case of the binomial model where the number of binomial steps is infinite.
Coffee is one of the most popular and consumed beverages in the world. High coffee consumption can have a substantial effect on health [1]. It is among the most traded agricultural commodities. In 2020, it is estimated that 10,520,820 tons of coffee were produced [2] and almost the same amount was consumed [3]. In Latin America, its production is an integral component of the livelihoods of millions coffee farmers, associates, and workers including their families [4].
Coffee has been cultivated in Ecuador since the eighteenth century. It is one of the ten most important crops, being grown entirely in rural areas. In total, the coffee area exceeds 30 thousand hectares planted [5]. Due to the geographical characteristics of Ecuador, it is one of the few countries in the world that cultivate the two commercial varieties:
One of the advantages of coffee cultivation is its adaptability to different ecosystems, in which it produces important environmental benefits. In Ecuador, coffee trees are managed as agroforestry systems. According to each region and its climatic conditions, coffee is grown together with forest species, mainly fruit trees, which provide temporary shade to the crop, and timber species that provide permanent shade [7]. This landscape arrangement contributes to the maintenance of appropriate habitat for various species of flora and fauna, the capture of carbon in the soil, and the water balance of ecosystems [8].
Despite the environmental advantages offered by this crop, the productive sector is affected not only by the consequences of the pandemic and the deterioration of the global economy but also by the change in climatic conditions that promote the migration and spread of pathogenic organisms such as the coffee leaf rust [9] and the coffee cherry borer which is very difficult to eradicate [10]. They are not the only plagues that affect coffee cultivation, but they are the ones that have caused the greatest economic losses in coffee production around the world [11].
The combination of strategies such as the use of chemical fungicides, quarantines, cultural practices, biocontrol agents, and the selection of resistant varieties have helped to reduce pests and diseases. However, climate change is threatening the survival of
Within this context, it is evident that Ecuador has optimal geographic and environmental conditions to produce quality coffee and overcome the new challenges of climate change. However, its production is lower compared with neighboring productive countries like Peru, Colombia, and Brazil. This fact is associated with other problems that are limiting the development of this productive sector. In this review, social, technical, and scientific aspects are analyzed in the whole production chain to understand the opportunities, needs of coffee growers, and the limitations in the production process. The importance of this research lies in unifying the information of the different regions and coffee productive associations that are scattered throughout the national territory and rescue the needs of small farmers often not considered.
The next sections will describe the production of coffee in rural areas, its challenges and opportunities, the development policies, the social and economic importance, and a description of the production process from planting to waste management. The tables and graphs collect important information about coffee growers-associations, crops distribution, cultivated varieties, and their characteristics. The photographs included in this chapter show images of a typical coffee farm in the Ecuadorian Andes.
In Ecuador, coffee farming is an activity that has been passed down from generation to generation. It is carried out entirely in rural areas, which are characterized by having very productive soils but a high rate of poverty, low percentage of basic education, absence of basic services, and bad connecting roads.
The first records of coffee export in Ecuador date back to 1980 in the province of Portoviejo Manabí [15]. Subsequently, thanks to the opening of world trade and the adaptability of this plant in the different Ecuadorian ecosystems, coffee is currently grown in 23 of the 24 provinces, becoming one of the 10 most important crops from an economic point of view [16]. Despite its importance, coffee production has been marked by ups and downs [17] and has substantially failed in improving the living conditions of rural farmers [18].
The crisis in the coffee sector covers many social and technological aspects and shows the little success of development policies. For example, the current Ecuadorian policy, in its 2015–2025 proposal, promote Sustainable Development Goals (SDGs). Literally, it suggests sustainable rural territorial development through the empowerment of the seven territorial planning areas that cover the entire country [19]. Even though, this policy has not been able to stop internal migration. According to projections by the National Institute of Statistics and Censuses (INEC), until 2010, only 35% of the population lived in rural areas with an annual decrease of 1.3% [20]. These data explain the aging of farmers because of young migration in search of better opportunities.
In the same way, the legal framework and the Constitution of Ecuador (2008) consider small farmers as priority groups for development. According to data from the FAO, more than 64% of the Ecuadorian agricultural production is in the hands of small producers categorized as Rural Farming Families (RFFs), on whom internal consumption depends. The RFFs represents 84.5% of the Agricultural Production Units (APU) [20]. These data highlight the importance of the rural sector in food production and the urgent need to change strategies to boost sustainable agriculture development. Unfortunately, not all NGOs development programs meet the needs of the population because they often replicate models used elsewhere resulting in a lack of cooperation between farmers.
In another context, Ecuador is considered a megadiverse country [21] and must find a balance between development and biodiversity conservation. With this goal, the Ministry of the Environment in 2011 proposed to increase protected areas by reducing the rate of deforestation, remedying environmental liabilities, reducing the use of pesticides, and addressing climate change through sustainable policies. To achieve part of this objective, the "Socio-Forest Program" and the "National Forestation and Reforestation Program" were created [22, 23]. However, there were many contradictions in the application of these measures. As an example, in the Amazon province of Orellana, palm crops (
For cocoa (
In conclusion, the policies of economic reactivation and conservation of rural areas must be reconsidered and oriented to grant a good quality of life for farmers. It is the only way to ensure sustainable development.
Coffee cultivation covers about 14% of the agricultural area of the country [29]. It is known as the unit crop due to its extension throughout the territory and the inclusion of all indigenous communities such as Quichua in the Andean region, Tsáchila in the Coastal region, and Shuar in the Amazon region.
Coffee production has a growing world demand and generates rural and urban employment because field activities include those necessary for the commercialization, transport, and industrialization processes. Also, it generates foreign income due to exportation. Export earnings are estimated to be between 60 and 80 billion dollars per year [30]. This income indicates the economic importance of the coffee sector in Ecuador. However, farmers are not the main beneficiaries of the coffee industry. Most of the income remains with the intermediaries who sell coffee on the international market [30]. An indicator of this reality is the high poverty rates in rural areas, which exceed 42% [20].
To survive, small farmers had to diversify their cropland. A small part is used to grow short-cycle food for sale and self-consumption. They also raise animals to obtain more economic income [29]. The difficult economic situation explains the migration of the younger population to the cities in search of better economic opportunities. This migration has caused the aging of farmers. It is estimated that the average age of coffee farmers is 50 years [20, 29, 31]. This means that over time their work capacity will decrease and there will be no new generations that continue with the activity.
To rescue coffee cultivation, small producers created the “benefits” that are legal associations that ensure fair trade. Unfortunately, 95% of coffee producers do not belong to any association [29]. One explanation for this fact is that most of the farms are in places of difficult access and do not have good communication channels. Phone signals do not work, and they live in isolation. Improving access to roads and basic services should be the government\'s priority to improve productivity. Table 1 shows the main coffee growers\' associations in Ecuador.
Coffee growers Associations | Province of action |
---|---|
Asociación Nacional Ecuatoriana de café (ANECAFÉ) | All provinces |
Federación Regional de Asociaciones de Pequeños Cafetaleros Ecológicos del Sur (FAPECAFE) | Loja, El Oro y Samora Chinchipe |
Asociación Agroartesanal de Caficultores “Río Íntag” (AACRI) | Imbabura y Pichincha |
Asociacion De Productores Y Comercializadores De Cafe Organico Bosque Nublado Golondrinas. | Carchi |
Empresa de Comercialización Asociativa de Manabí (COREMANABA) Corporación Ecuatoriana de Cafetaleros (CORECAF) Federación de Asociaciones Artesanales de Producción Cafetalera Ecológica de Manabí (FECAFEM). | Portoviejo, Guayas |
Asociación Aroma amazónico | Sucumbios y Orellana |
Asociación Aroma amazónico | Sucumbios y Orellana |
Ecuadorian coffee growers association by Provinces.
Another important issue is the fact that farmers produce coffee, but they don’t have the culture of coffee, understanding that they are not coffee drinkers. This is a fundamental difference from other neighboring countries such as Colombia where a true culture of coffee has been achieved and promoted through tourist activities that generates additional income for coffee growers. This data was observed after visiting several rural farms in the Andean region.
Creating a culture of coffee around this drink could influence the quality of the final product. The National Ecuadorian Coffee Association (ANECAFE) organizes different tasting events for this purpose.
The quality of coffee depends on its organoleptic characteristics, which in turn depend on many other factors, including the genetics of the plant, the environmental conditions, the agricultural practices, the degree of cherry ripeness, and the post-harvest processing and the storage and transport conditions. Each step in coffee production is then of fundamental importance for obtaining the golden bean [32].
Due to the different ecosystem characteristics, Ecuador is one of the few countries in the world that can cultivate the two commercial species of coffee,
Distribution of
Region | Environmental conditions for coffee cultivation |
---|---|
Andean | 18–23°C 1500–2900 masl |
Coast | 25–30°C 40–600 masl |
Amazon | 23° <500 masl |
Galapagos | 25°C 180–450 masl |
Environmental conditions of coffee plantations by region.
Of the two species,
The most cultivated varieties of
Variety | Characteristics |
---|---|
Bourbon | It is originated from the Typica variety. It is known for its excellent cup quality. It has a 30% higher productivity than the typical variety. It reaches heights of 3 m, being susceptible to winds. Its maturation is early and there is a risk of fruit falling due to rain |
Typica | Originally from Ethiopia, it began the history of coffee cultivation in America. It is characterized by being high (4 m). It has low productivity and is susceptible to rust. However, its cup is highly valued. It grows between 1300 and 1800 masl |
Caturra | Arose from a mutation of bourbon. It is a low height (1.8 m). Its fruits can be red and yellow. They are characterized by early maturation. They tolerate drought, wind, and sun exposure better |
Geisha | Originally from Ethiopia. The most important characteristic is its excellent cup and for that reason, it still occupies a place in production, however, it has low productivity and resistance to rust |
Catucaí | It comes from an artificial cross between the Mundo Novo and Caturra varieties carried out in Brazil. They reach heights of 2.25 m and have high productivity (7.9 tons/hectare). The maturation of its fruit is late, being beneficial for areas where maturation coincides with the rainy season |
Timor | The Timor Hybrid is originated from a spontaneous cross between the Typica variety of |
Castillo | It is originated from Colombia. It was developed by the National Coffee Research Center (Cenicafe). It is a pest-resistant plant characterized by being precocious and highly productive |
Sidra | Discovered in Ecuador as a result of a cross between the Typica and Bourbon varieties. It is known for its aroma of flowers and fruits |
Sarchimor | The Sarchimores are plants of low size, green or bronze bud, vigor, and high production, well adapted to low and medium altitude areas, and good cup quality |
Most common
Most coffee growers in Ecuador prefer the quality of the final product due to the higher economic income obtained with an excellent coffee rating. The National Ecuadorian Coffee Association (ANECAFE), for example, awards the best producers with the “golden cup”. The golden cup is a contest in which international experts evaluated different coffee quality parameters like aroma, sweetness, body, color, and others. In 2021, the Sidra and Geisha varieties, grown in the Andean provinces of Pichincha and Loja, were the most appreciated by the expert\'s panel, achieving quality scores higher than 90 points [42]. This nomination allows farmers to sell coffee at prices 10–100 times higher.
On the other hand, robusta coffee grows in warmer places on the coast and in the Amazon region. It is more productive, resistant to high temperatures and pests, and contributes mainly to the local market. It is appreciated in special mixes and soluble coffee production [43]. Maincrop differences between
Arabica | Robusta | |
---|---|---|
Time from flower to ripe cherry | 9 months | 10–11 months |
Yield (kg beans/ha) | 1500–2000 | 2300–4000 |
Optimum temperature (yearly average) | 15–24°C | 24–30°C |
Optimal rainfall | 1500–2000 mm | 2000–3000 mm |
Optimal altitude | 1000–2000 masl | 0–700 masl |
Caffeine content of beans | 0.8–1.4% | 1.7–4% |
Maincrop differences between
In terms of genetics, there is significant variability of bean chemical composition and organoleptic characteristics between arabica and robusta and within variety levels [41]. Therefore, genetic gains for quality can be achieved by hybridization strategies and the use of new genomic tools that offers the opportunity to accurately decipher the genomic control of quality components.
Coffee is grown under agroforestry polyculture systems that, on the one hand, allow the conservation of biodiversity and, on the other hand, provide multiple advantages to coffee plantations. The trees provide shade, helping to maintain a suitable temperature. They also form a barrier that prevents damage from strong winds and rain and counteracts the spread of pathogens. In addition, they prevent soil erosion, forming ecosystem corridors that allow maintaining a considerable biodiversity of flora, fauna, and beneficial microorganisms [44].
The most common trees found in Ecuadorian coffee plantations are a mix of fruit trees (
Coffee trees under agroforestry system. Intag-Ecuador. (Source: Sania Ortega).
Because of all positive factors, the agroforestry system is more sustainable. However, it is important that farmers adapt this system to their specific conditions to avoid competition between species for nutrients and water. This competition could decrease production. The tree density recommended by the sustainable agriculture network (SAN) is 40%. Higher densities subtract sunlight from coffee, producing opposite effects [46]. The choice of shade trees is also important. Trees with deep and widely branched roots are generally preferred. Leguminous trees are also relevant for their ability to fix nitrogen. In Ecuador, the leguminous Guaba tree (
Coffee trees tolerate a wide range of soils if they are deep, porous, well-drained, and well balanced for their texture. Coffee is not very demanding in soil fertility, and it can be cultivated in fertile as well as in poor soils even in acidic soils. Ecuadorian volcanic soils are particularly well suited for coffee [48]. Nonetheless, the production of green coffee leads to the depletion of nutrients. This depletion needs to be compensated by appropriate fertilization to keep a constant and high production. Proper nutrition is important for vigorous plants. Parameters such as the age of the coffee trees, the planting density, and the degree of intensification must be considered [46]. It is advisable to take soil samples before applying fertilizers. Foliar fertilization is often used to compensate deficiencies in micronutrients like zinc, boron, iron, and manganese [49].
Ecuadorian rural farms do not have nearby laboratories to monitor the nutrient content in the soil. So, fertilization and fumigation are based on farmers\' intuition and experience. Unfortunately, this is a problem that could seriously affect the quality of the soils as well as coffee production. Another problem is the lack of records of the treatments applied.
Although correct fertilization can supply any nutrient deficiency, to guarantee sustainability it is important to preserve the soil microbiota. Microorganisms play a very important role in soil fertility and crop production because of their ability to promote plant growth, enhance biotic and abiotic stress resistance, and facilitate and improve the absorption of nutrients by the root [50].
Plant growth-promoting microorganisms, and arbuscular mycorrhizal fungi (AMF) have been used in coffee trees to improve productivity and reduce the application of chemical fertilizers [50, 51]. In a study carried out in Mexico, for example, it was shown that the inoculation of coffee seedlings with
A critical task for coffee growers around the world is the control of pathogens and diseases. The biotrophic fungus
On the other hand, coffee berry borer (
With this overview, obtaining quality coffee is not an easy task and requires extensive technical and scientific knowledge. The error of the programs carried out by the Ministry of Agriculture was to generalize production and not consider the unique characteristics of each ecosystem. Successful models in other countries are not always adapted to the reality of each region. In conclusion, there are research lines that must be established to select varieties with superior characteristics, understand the ecological relationship of coffee in each ecosystem and isolate native microorganisms useful to improve plant growth and pest. It is also important to register the treatments and practices carried out by the farmers and learn from their experiences.
The cup of coffee has a process behind it that varies according to the region, the variety of coffee planted, and the use of the different post-harvest treatments. All these factors give each coffee a unique flavor.
Coffee trees, depending on the specific variety, take between 3 and 4 years to bear the first fruits. Generally, coffee cherry ripening is faster in lower and warmer areas. Nonetheless, slow ripening is more advisable to achieve better organoleptic characteristics [64]. To guarantee coffee quality, it is important to harvest only ripe fruits. The coffee tree declines its productivity after 20 years [65]. Therefore, it is important to renew coffee plantations.
The process of harvesting coffee beans can be carried out by different methods, among which are manual or mechanical. In Ecuador, a manual process is the most used. Workers collect the coffee berry, avoiding collecting green ones and discarding the grains that are dry or damaged. All coffee fruits are collected in plastic handcrafted containers and transported to the classification area. Harvesting depends on the labor and skill acquired to select the best fruits. In general, it is hard work since the collectors must walk long distances on slopes where a big part of coffee plantations are located.
After fruits collection, the flotation technique is used for the selection of the beans. It consists in covering the cherries with water. Contaminants such as stones, garbage, and floats are discarded. Subsequently, a second review of the fruits is carried out, spreading them on African beds or similar structures to discard those that are not cherry-colored. All discarded fruits (pasilla) are considered inferior in quality and therefore have a lower price in the market.
Post-harvest treatments are part of the coffee production process, the latter can be classified into three different types of processing: wet or washed, dry or natural, and semi-dry or honey. The country\'s coffee growers carry out empirical experiments to determine which treatment provides the best quality results. In general, dry processes are applied in the Robusta variety, and wet ones in Arabica [66, 67]. The different steps of each process are summarized in Figure 3.
Coffee processing technologies.
All treatments share the harvest and flotation stage. The natural or dry process is considered the simplest and most traditional at the national level since it consists of the direct drying of the fruits and the subsequent removal of the dry pericarp by manual or mechanical action [68]. On the other hand, the semi-dry process has a previous stage of mechanical pulping to remove the pericarp before drying [67]. Finally, the wet process requires a fermentation step which needs robust control. The quality of the coffee obtained from the wet process is generally higher compared to the other processes [68].
Natural processing is considered the oldest and most traditional technology. It is relatively simple and inexpensive. Previously selected cherries went through a drying process, to finally be shelled and pulped. The drying process prevents the growth of microorganisms. It is done under the sun or through air dryers that allow reaching a humidity of 10–12%, which is considered a standard measure for the coffee to retain its volatile compounds until roasting [67, 68].
In Ecuador, the Robusta coffee is dried directly under the sunlight. The advantage of this process is the cost. However, there are several disadvantages such as the time of the process which depends on the weather conditions, and the constant control required to prevent damage due to dust, rain, or storms. This process ends with the extraction of the pericarp and the dry pulp to obtain only the green coffee beans that will be later stored. This can be done manually through a mortar or threshing machine, or through mechanical hullers.
The wet process is the treatment with the best results in terms of coffee quality [69]. The main difference with the dry process is the pulped step. The pulping is carried out mechanically and consists of the removal of the exocarp and part of the mesocarp of the coffee cherry. Figures 4 and 5, show a classical pulped machine used by smallholders. The pulp is squeezed through a rotating disc or drum. This process must be carried out in a way that does not damage the bean which could lead to microbial attack or contamination. The part of the remaining mesocarp is the mucilage, which will be important in the subsequent fermentation process [67, 70].
Pulped Machine in Piedra Grande San Jerónimo’s Farm, Lita-Imbabura (source: Sabastian Obando).
Pulped process of a family agroforestry system. Intag-Ecuador. (source: Sania Ortega).
Mucilage fermentation is the important turning point for wet production due to the quality indicators that it provides such as aroma and flavor [70, 71]. The fermentation process is important to degrade the mucilage resulting from the previous process, containing a large amount of pectin, starch, and cellulose; being an ideal substrate for yeasts and bacteria [71]. In Ecuador, a metagenomic study on the fermentation processes of coffee was developed confirming the presence of enterobacteria, lactic acid bacteria, and yeasts as the majority of microorganisms’ groups [72]. Microorganism isolation and evaluation of fermentation ability must be the next step to improve flavor quality.
Microorganisms are the secret of fermentation. Its metabolic routes produce secondary metabolites and volatile compounds associated with aromas and flavors [73].
Studies have been carried out to isolate different microorganisms and evaluate their ability to produce volatile compounds and how they affect coffee quality [74, 75]. Alcohols are abundant volatile metabolites that fulfill various functions such as providing fruity aromas and flavors, contributing to physical characteristics
The washing process must be carried out immediately after the fermentation process is completed to avoid an overfermentation and production of propionic and butyric acid that are related to onion flavors and aromas. Washing is done with drinking or irrigation water seeking to remove all the mucilage resulting from the fermentation process before drying. The drying and shelling are carried out under the same conditions as the dry or natural process [67, 68]. Figure 6 is a classical air-drying installation.
Sun-drying coffee beans. (Source Sebastian Obando).
The semi-dry process is a combination of the two previous processes. The bean with the layer of mucilage is left to dry directly in the sun, as in both processes. This step allows the layer of mucilage to impregnate the bean giving it a color and texture equal to honey. It is a process that requires less control. The fermentation process is considered to occur in the drying stage. Microbial inoculants have been also studied in this process [77, 78].
This process is the most recommended in Ecuador since it allows to obtain high quality and produces less wastewater. Some types of coffee processed with the wet and honey method have been awarded with the golden cup [42]
After coffee bean processing, bean coffee could be roasted or stored. Storage conditions must be controlled to prevent fungal growth and mycotoxin production [79].
Like cultivation, coffee processing requires extensive knowledge and special attention since it directly influences the quality of the final product. Each producer maintains in reserve the details of the processing, especially in the fermentation stage. However, cooperation between producers is a key factor in marketing. Coffee Associations often fail to meet the demand of international markets due to differences in quality obtained between partners.
As in cultivation, coffee producers experiment by varying production methods or parameters during the process. Although the experimentation carried out is a positive aspect, it is necessary to standardize the production to guarantee the same quality in all harvests. Research is also an essential component of development.
Each process generates a different type and volume of waste such as water, pulp, and parchment (Figure 1). It is estimated that ¾ of the volume of the total beans harvested are residues [80]. Since in Ecuador the cultivation of coffee is a family and rural activity, the use of sophisticated technologies for the valorization of residues is not applicable. The most suitable technologies are related to reuse in agriculture, animal feed, and energy production [81].
A large part of the farmers processes their own coffee on the farm, so the waste is managed internally. A common practice is to spread the residues directly on the fields and let them naturally degrade. However, the application of not completely degraded residues produces adverse effects, including phytotoxicity [82]. On the other hand, this practice facilitates the spread of pests from infected and discarded fruits, and bad odors, among others. In addition, this bad practice produces contamination of water sources. Most of the farms are located on hills and when it rains the water carries pollutants to the lower areas that end up polluting rivers.
Other coffee growers take the harvested beans to the collection centers to be processed afterward. These collection centers usually have a place for composting. Compost obtained is then sold as an amendment to use in coffee or other minor crops. Data on the quality of this amendment is not available. Generally, composting process is carried out under partial or not controlled conditions. Something important to highlight is that each farm must be concerned about its sustainability to be competitive. Organic certifications are always more important to gain and guarantee a marketplace. On the other hand, chemical fertilizers are expensive. Therefore, taking advantage of nutrient-rich waste is the most viable option for self-sustainability.
Coffee by-products are characterized by a high concentration of nutrients and other compounds such as polyphenols and caffeine that in high concentrations could be phytotoxic [80]. For this reason, it is important to a stabilization treatment before its use in agriculture. Composting remains the best and cheapest way to achieve this aim. However, it must be a controlled process to guarantee phytotoxic reduction and pathogens elimination.
Because composting is a microbial degradation process. The selection of specific degrading microorganisms could be a good option to improve compost quality and reduce composting time. Compost can also be used as a strategy to introduce PGPR and biocontrol agents. A similar experience was achieved by the Italian olive industry which residues are very similar in composition to those of coffee [83].
Generally, coffee growers mix coffee by-products with other agricultural residues from minor crops and manure from raising pigs, chickens, guinea pigs, and cows. These processes are not technical and therefore the results obtained may be variable or not satisfactory. For this reason, boosting the correct management of composting technology would require appropriate training for groups. This should include appropriate training on quality control of the final product to guarantee the reduction of phytotoxicity, the elimination of pathogens, and the stabilization of the compost. Good results of compost application in rural areas were obtained in Vietnam [84].
Another re-utilization process is to use by-products as animal feed. The presence of tannins and caffeine diminishes the acceptability and palatability of husk by animals. So, the degradation of caffeine by microorganisms, especially bacteria, needs further studies.
In conclusion, composting is the most applicable technology to coffee waste management because it only requires a space that farms generally have and common work tools to remove de compost. It also helps to return to the soil part of the nutrients extracted by agriculture. Other technologies are too expensive and require big quantities to recover the investment. As in cultivation and processing, waste disposal should also be linked to research programs that over time can provide alternative solutions contributing to rural and sustainable development.
Coffee is a strategic crop; it has a growing world market and therefore great economic potential. It also has environmental benefits that distinguish it from other expansive crops such as palm and banana.
On the other hand, Ecuador has optimal geographical and climatic conditions for growing coffee but has a lower production (3–5 quintals/ha) compared to other producing countries in the region such as Brazil and Colombia (35–40 quintals/ha) [20]. These competitive disadvantages prevent Ecuador from covering the market demand, which has affected the coffee trade [17]. The low productivity can be explained by many factors such as poverty in rural areas, lack of trained workers, inadequate management of pests and diseases, the presence of aged coffee plantations, insufficient infrastructure technology for post-harvest processes, and the lack of effective marketing channels [15]. To overcome these deficiencies, it is essential to improve the quality of life of farmers by guaranteeing access to basic services and education. Farmer’s income must be protected with adequate economic policies. This will allow new generations to see agriculture as a profitable livelihood and assure sustainability.
Scientific research is also important to overcome problems like pest control and productivity. Reactivation programs must include the active participation of research centers and not just incentives and subsidies.
The sustainable development of coffee farming in rural areas does not necessarily require large investments, but it does require cooperation between farmers and research centers to guarantee knowledge transfer. The variability of coffee quality between farmers fails to meet market demand. Coffee producers tend to compete rather work as a team and help others to achieve quality, so cooperation is a point of force.
Under current conditions, Ecuador is not competitive in terms of volume due to a lack of technology and workforce, however, it can be very competitive in terms of quality thanks to the variability of ecosystems that give coffee special characteristics.
The results of the coffee-cocoa reactivation program established by the Ministry of Agriculture of Ecuador in the years 2012–2021 are expected to show appreciable improvements in productivity. Furthermore, this program is expected to allow the renovation of coffee plantations, the technical training of farmers, and the implementation of modern infrastructure.
Making changes in public policies to comply with territorial development programs that are based on sustainable development objectives is needed. Public policy in the “Socio Bosque” Program, for example, should be strengthened to generate incentives for farmers who have or opt for agroecological plantations and have organic certifications. In this way, the program would ensure the maintenance of primary forests while increasing economic income for coffee-growing families. In this way, conservation would be guaranteed along with the improvement of life quality.
We want to thank the associations of organic coffee producers Bosque Nublado Golondrinas and Río Intag for opening the doors of their farms and sharing with us their day-by-day efforts in this wonderful activity.
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Films",slug:"compilation-on-synthesis-characterization-and-properties-of-silicon-and-boron-carbonitride-films",totalDownloads:5219,totalCrossrefCites:6,totalDimensionsCites:19,abstract:null,book:{id:"326",slug:"silicon-carbide-materials-processing-and-applications-in-electronic-devices",title:"Silicon Carbide",fullTitle:"Silicon Carbide - Materials, Processing and Applications in Electronic Devices"},signatures:"P. Hoffmann, N. Fainer, M. Kosinova, O. Baake and W. Ensinger",authors:[{id:"56722",title:"Dr.",name:"Peter",middleName:null,surname:"Hoffmann",slug:"peter-hoffmann",fullName:"Peter Hoffmann"},{id:"56726",title:"Dr.",name:"Marina",middleName:null,surname:"Kosinova",slug:"marina-kosinova",fullName:"Marina Kosinova"},{id:"56727",title:"Prof.",name:"Wolfgang",middleName:null,surname:"Ensinger",slug:"wolfgang-ensinger",fullName:"Wolfgang Ensinger"}]},{id:"60792",doi:"10.5772/intechopen.76062",title:"TCAD Device Modelling and Simulation of Wide Bandgap Power Semiconductors",slug:"tcad-device-modelling-and-simulation-of-wide-bandgap-power-semiconductors",totalDownloads:2161,totalCrossrefCites:15,totalDimensionsCites:16,abstract:"Technology computer-aided Design (TCAD) is essential for devices technology development, including wide bandgap power semiconductors. However, most TCAD tools were originally developed for silicon and their performance and accuracy for wide bandgap semiconductors is contentious. This chapter will deal with TCAD device modelling of wide bandgap power semiconductors. In particular, modelling and simulating 3C- and 4H-Silicon Carbide (SiC), Gallium Nitride (GaN) and Diamond devices are examined. The challenges associated with modelling the material and device physics are analyzed in detail. It also includes convergence issues and accuracy of predicted performance. Modelling and simulating defects, traps and the effect of these traps on the characteristics are also discussed.",book:{id:"6625",slug:"disruptive-wide-bandgap-semiconductors-related-technologies-and-their-applications",title:"Disruptive Wide Bandgap Semiconductors, Related Technologies, and Their Applications",fullTitle:"Disruptive Wide Bandgap Semiconductors, Related Technologies, and Their Applications"},signatures:"Neophytos Lophitis, Anastasios Arvanitopoulos, Samuel Perkins and\nMarina Antoniou",authors:[{id:"236488",title:"Dr.",name:"Neophytos",middleName:null,surname:"Lophitis",slug:"neophytos-lophitis",fullName:"Neophytos Lophitis"},{id:"247344",title:"Dr.",name:"Marina",middleName:null,surname:"Antoniou",slug:"marina-antoniou",fullName:"Marina Antoniou"},{id:"247347",title:"Mr.",name:"Anastasios",middleName:null,surname:"Arvanitopoulos",slug:"anastasios-arvanitopoulos",fullName:"Anastasios Arvanitopoulos"},{id:"247349",title:"Mr.",name:"Samuel",middleName:null,surname:"Perkins",slug:"samuel-perkins",fullName:"Samuel Perkins"}]},{id:"21151",doi:"10.5772/20332",title:"Recent Developments on Silicon Carbide Thin Films for Piezoresistive Sensors Applications",slug:"recent-developments-on-silicon-carbide-thin-films-for-piezoresistive-sensors-applications",totalDownloads:4534,totalCrossrefCites:0,totalDimensionsCites:11,abstract:null,book:{id:"326",slug:"silicon-carbide-materials-processing-and-applications-in-electronic-devices",title:"Silicon Carbide",fullTitle:"Silicon Carbide - Materials, Processing and Applications in Electronic Devices"},signatures:"Mariana Amorim Fraga, Rodrigo Sávio Pessoa, Homero Santiago Maciel and Marcos Massi",authors:[{id:"38456",title:"Dr.",name:"Mariana",middleName:null,surname:"Amorim Fraga",slug:"mariana-amorim-fraga",fullName:"Mariana Amorim Fraga"},{id:"53494",title:"Dr.",name:"Rodrigo",middleName:"Savio",surname:"Pessoa",slug:"rodrigo-pessoa",fullName:"Rodrigo Pessoa"},{id:"91253",title:"Dr.",name:"Homero",middleName:"Santiago",surname:"Maciel",slug:"homero-maciel",fullName:"Homero Maciel"},{id:"91254",title:"Dr.",name:"Marcos",middleName:null,surname:"Massi",slug:"marcos-massi",fullName:"Marcos Massi"}]},{id:"21143",doi:"10.5772/24347",title:"SiC, from Amorphous to Nanosized Materials, the Exemple of SiC Fibres Issued of Polymer Precursors",slug:"sic-from-amorphous-to-nanosized-materials-the-exemple-of-sic-fibres-issued-of-polymer-precursors",totalDownloads:3485,totalCrossrefCites:2,totalDimensionsCites:10,abstract:null,book:{id:"326",slug:"silicon-carbide-materials-processing-and-applications-in-electronic-devices",title:"Silicon Carbide",fullTitle:"Silicon Carbide - Materials, Processing and Applications in Electronic Devices"},signatures:"Philippe Colomban",authors:[{id:"14026",title:"Dr.",name:"Philippe",middleName:null,surname:"Colomban",slug:"philippe-colomban",fullName:"Philippe Colomban"}]},{id:"60400",doi:"10.5772/intechopen.75999",title:"Clamping Force Distribution within Press Pack IGBTs",slug:"clamping-force-distribution-within-press-pack-igbts",totalDownloads:1054,totalCrossrefCites:3,totalDimensionsCites:9,abstract:"Press pack insulated gated bipolar transistors (PP IGBTs) have been gradually used in the high-voltage and high-power-density applications, such as the power system and electric locomotive, with its advantages of double-sided cooling, higher power density, and easy to connect in series compared with traditional wire-bonded power IGBT modules. However, the clamping force is quite important for PP IGBTs because too much clamping fore will cause mechanical damage to the silicon chips and too little clamping force will increase the junction temperature of the silicon chips due to the increased thermal contact resistance. And eventually it leads to thermal damage. Furthermore, the clamping force distribution within PP IGBTs is affected by many factors, and they can be divided into the internal and external factors. The finite element analysis model of the PP IGBTs is established based on the theory of elastic mechanics to obtain the influence of the affect factors, including the external clamping modes, spring design, thermal stress, the machining accuracy, and so on. The contribution of those affect factors to the clamping force distribution is ranked, and this can be a guideline not only for users but also for the manufacturers.",book:{id:"6695",slug:"design-simulation-and-construction-of-field-effect-transistors",title:"Design, Simulation and Construction of Field Effect Transistors",fullTitle:"Design, Simulation and Construction of Field Effect Transistors"},signatures:"Erping Deng, Zhibin Zhao, Jinyuan Li and Yongzhang Huang",authors:[{id:"234852",title:"Dr.",name:"Erping",middleName:null,surname:"Deng",slug:"erping-deng",fullName:"Erping Deng"}]}],mostDownloadedChaptersLast30Days:[{id:"60792",title:"TCAD Device Modelling and Simulation of Wide Bandgap Power Semiconductors",slug:"tcad-device-modelling-and-simulation-of-wide-bandgap-power-semiconductors",totalDownloads:2155,totalCrossrefCites:15,totalDimensionsCites:16,abstract:"Technology computer-aided Design (TCAD) is essential for devices technology development, including wide bandgap power semiconductors. However, most TCAD tools were originally developed for silicon and their performance and accuracy for wide bandgap semiconductors is contentious. This chapter will deal with TCAD device modelling of wide bandgap power semiconductors. In particular, modelling and simulating 3C- and 4H-Silicon Carbide (SiC), Gallium Nitride (GaN) and Diamond devices are examined. The challenges associated with modelling the material and device physics are analyzed in detail. It also includes convergence issues and accuracy of predicted performance. Modelling and simulating defects, traps and the effect of these traps on the characteristics are also discussed.",book:{id:"6625",slug:"disruptive-wide-bandgap-semiconductors-related-technologies-and-their-applications",title:"Disruptive Wide Bandgap Semiconductors, Related Technologies, and Their Applications",fullTitle:"Disruptive Wide Bandgap Semiconductors, Related Technologies, and Their Applications"},signatures:"Neophytos Lophitis, Anastasios Arvanitopoulos, Samuel Perkins and\nMarina Antoniou",authors:[{id:"236488",title:"Dr.",name:"Neophytos",middleName:null,surname:"Lophitis",slug:"neophytos-lophitis",fullName:"Neophytos Lophitis"},{id:"247344",title:"Dr.",name:"Marina",middleName:null,surname:"Antoniou",slug:"marina-antoniou",fullName:"Marina Antoniou"},{id:"247347",title:"Mr.",name:"Anastasios",middleName:null,surname:"Arvanitopoulos",slug:"anastasios-arvanitopoulos",fullName:"Anastasios Arvanitopoulos"},{id:"247349",title:"Mr.",name:"Samuel",middleName:null,surname:"Perkins",slug:"samuel-perkins",fullName:"Samuel Perkins"}]},{id:"61629",title:"GaN-Based Schottky Diode",slug:"gan-based-schottky-diode",totalDownloads:1694,totalCrossrefCites:2,totalDimensionsCites:2,abstract:"Schottky diode, also known as Schottky barrier diode (SBD), fabricated on GaN and related III-Nitride materials has been researched intensively and extensively for the past two decades. This chapter reviews the property of GaN material, the advantage of GaN-based SBD, and the Schottky contact to GaN including current transporation theory, Schottky material selection, contact quality and thermal stability. The chapter also discusses about the GaN lateral, quasi-vertical and vertical SBDs, and AlGaN/GaN field effect SBDs: the evolution of the epitaxial structure, processing techniques and device structure. The chapter closes with challenges ahead and gives an outlook on the future development of the GaN SBDs.",book:{id:"6625",slug:"disruptive-wide-bandgap-semiconductors-related-technologies-and-their-applications",title:"Disruptive Wide Bandgap Semiconductors, Related Technologies, and Their Applications",fullTitle:"Disruptive Wide Bandgap Semiconductors, Related Technologies, and Their Applications"},signatures:"Yaqi Wang",authors:[{id:"237104",title:"Dr.",name:"Yaqi",middleName:null,surname:"Wang",slug:"yaqi-wang",fullName:"Yaqi Wang"}]},{id:"53537",title:"FPGA-Based Software-Defined Radio and Its Real-Time Implementation Using NI-USRP",slug:"fpga-based-software-defined-radio-and-its-real-time-implementation-using-ni-usrp",totalDownloads:2828,totalCrossrefCites:0,totalDimensionsCites:0,abstract:"In this chapter, we propose a novel design of scalable and real-time data acquisition software architecture for software-defined radio (SDR) using universal software radio peripheral (USRP). The software has been designed and tested in multi-thread model, using LabVIEW, which guarantees real-time performance and efficiency. With the help of this design, we have been able to improve the stability of the system besides providing a reconfigurable and flexible architecture. Wireless transfer of sensitive data using communication is not a very safe option. In this chapter, we aim to provide a safe and private wireless transmission between two terminals using the SDR approach and verifying the results in real-world environment with the use of USRP. The novel design being presented here can be used to transfer (random data, text or an image) encoded with different forward error correction (FEC) codes, which is then verified at the receiving terminal and then decoded accordingly to produce the desired result.",book:{id:"5597",slug:"field-programmable-gate-array",title:"Field",fullTitle:"Field - Programmable Gate Array"},signatures:"Nikhil Marriwala, Om. Prakash. Sahu and Anil Vohra",authors:[{id:"192912",title:"Associate Prof.",name:"Nikhil",middleName:null,surname:"Marriwala",slug:"nikhil-marriwala",fullName:"Nikhil Marriwala"},{id:"198652",title:"Prof.",name:"O.P",middleName:null,surname:"Sahu",slug:"o.p-sahu",fullName:"O.P Sahu"},{id:"198654",title:"Prof.",name:"Anil",middleName:null,surname:"Vohra",slug:"anil-vohra",fullName:"Anil Vohra"}]},{id:"61186",title:"Graphene Field-Effect Transistor for Terahertz Modulation",slug:"graphene-field-effect-transistor-for-terahertz-modulation",totalDownloads:1322,totalCrossrefCites:2,totalDimensionsCites:3,abstract:"The real-world applications of terahertz (THz) technology necessitate versatile adaptive optical components, for example, modulators. In this chapter, we begin with a brief review on different techniques for THz modulation. After that, we introduce the extraordinary features of graphene along with its advantages and disadvantages as channel materials for field effect transistor (FET). We then discuss two types of graphene FET-based THz modulators, one is rigid and another is flexible. The feasibility of the high-quality THz modulators with different graphene FET structures has been successfully demonstrated. It is observed that by tuning the carrier concentration of graphene by electrical gating, the THz modulation can be obtained with relatively large modulation depth, broad width band, and moderate speed. This chapter helps the reader in obtaining guidelines for the proper choice of a specific structure for THz modulator with graphene FET.",book:{id:"6695",slug:"design-simulation-and-construction-of-field-effect-transistors",title:"Design, Simulation and Construction of Field Effect Transistors",fullTitle:"Design, Simulation and Construction of Field Effect Transistors"},signatures:"Qi-Ye Wen, Yu-Lian He, Jing-Bo Liu, Qi Mao, Qing-Hui Yang, Zhi\nChen and Huai-Wu Zhang",authors:[{id:"235512",title:"Prof.",name:"Qiye",middleName:null,surname:"Wen",slug:"qiye-wen",fullName:"Qiye Wen"},{id:"247833",title:"Ms.",name:"Yu-Lian",middleName:null,surname:"He",slug:"yu-lian-he",fullName:"Yu-Lian He"},{id:"247834",title:"Prof.",name:"Zhi",middleName:null,surname:"Chen",slug:"zhi-chen",fullName:"Zhi Chen"},{id:"247837",title:"Prof.",name:"Qing-Hui",middleName:null,surname:"Yang",slug:"qing-hui-yang",fullName:"Qing-Hui Yang"},{id:"247839",title:"Prof.",name:"Huai-Wu",middleName:null,surname:"Zhang",slug:"huai-wu-zhang",fullName:"Huai-Wu Zhang"}]},{id:"53730",title:"High‐Speed Deterministic‐Latency Serial IO",slug:"high-speed-deterministic-latency-serial-io",totalDownloads:1772,totalCrossrefCites:0,totalDimensionsCites:0,abstract:"In digital systems, serial IO at speeds in the range from 1 to 20 Gbps is realized by means of dedicated transceivers, named serializer-deserializers (SerDeses). In general, due to their internal architecture, the data transfer delay, or the latency, may vary after a reset of the device. On the other hand, some applications, such as high-speed transfer protocols for analog-to-digital and digital-to-analog converters, trigger and data acquisition systems, clock distribution, synchronization and control of radio equipment need this delay to be constant at each reset. In this chapter, we focus on a serial IO architecture based on configurable transceivers embedded in field-programmable gate arrays (FPGAs). We will show how it is possible to achieve deterministic-latency operation in a line-code-independent way. 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