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Russia’s growing wheat export business: What drives export growth, trade stability and pricing strategies?

Research domain:
Securing the world’s food supply and competitive supply chains

Project duration:
01.08.2023 - 31.07.2026

In the last two decades, Russia has expanded its wheat export business replacing the US as the world’s largest wheat exporter. Despite the circumstances related to the invasion of Russian forces in Ukraine, it is forecasted that Russia will remain a dominant supplier of wheat to the world market. However, although Russia’s wheat trade pattern might become more influenced by geopolitics, it can be expected that wheat deliveries to the import depending countries in the South will sustain, while competing with the Western exporters on the world market. There is a lack of empirical research on Russian wheat trade, although the country is shaping the international wheat trade system. Especially, Russia has frequently restricted its wheat exports which has reduced wheat availability on international markets and exacerbated price increases.

This project aims to empirically assess the Russian wheat export business in the context of global food security. The analyzes are based on Melitz's "New" New Trade Theory (NNTT) and focus on firm differences to explain trade relations and its determining factors. The project therefore expands the application of the NNTT towards trade of agricultural commodities and, at the same time, transfer the Melitz approach to pure trading companies. From a policy perspective, the project will contribute to the UN’s Sustainable Development Goal of eliminating malnutrition and hunger. Finally, the project work will provide insights in designing general export-led growth strategies, valuable for countries which aim to develop their agricultural export sector.