The Assessment of the Potential of Russian Grain Trade in Asian and African Countries: A Gravity Model Approach

This study examines the potential of grain trade within the context of global commerce, highlighting its role as a primary component of the worldwide agricultural market and a crucial factor in ensuring global food security and price stability. To achieve the research objectives, we utilized panel data from Russia, a leading player in the grain market, and employed a gravity model along with Poisson pseudo-maximum likelihood (PPML) to analyze the impact of demand factors and the economic openness of importing countries, as well as the effects of distance, sea access, borders, language, trade unions, and tariffs on exports. Our research challenges the notion that an increase in the wealth of countries leads to a corresponding rise in trade between them. In the case of grain, evidence indicates a negative contribution of GDP per capita in importing countries. The gravity model and PPML enabled us to assess individual country effects and quantitatively evaluate the potential for increasing Russian grain exports to Asian and African nations. We propose recommendations for enhancing domestic grain production and improving the effectiveness of marketing strategies in countries with underutilized export potential.