ABSTRACT
The impressive volumes of wheat production in Russia on the one hand and the good baking quality of Russian wheat on the other hand enabled Russia to become one of the important wheat producers and exporters of the world since the recent few years. However, Russia has a long way to go on the “front” of Sanitary and Phytosanitary (SPS), i.e. food safety, standards. As part of a larger study, financed by the German Research Foundation, the current research addresses the objective of estimating the potentials of wheat production in Russia under more stringent food safety standards as the current Russian national SPS regulations are. The comparative advantage analysis based on the domestic resource cost (DRC) approach is applied to estimate the possible compliance of Russian norms with European Union (EU) SPS standards.
The DRC analysis resulting in a ratio of 0.37 provides evidence of high social profitability of wheat chain in the Stavropol region. Also the scenarios of compliance of Russian food safety norms with those of EU offer plausible solutions with DRC ratios varying within the range of 0.49–0.96 dependent on the fluctuations of model parameters.
From the methodological point of view, the paper represents one of the rare cases, where DRC is applied for food safety issues in a transition country context.
