A STUDY OF THE RELATIONSHIP BETWEEN DOMESTIC AND WORLD WHEAT PRICES IN THE EU AND IN RUSSIA

The article is devoted to the study of the influence of the dynamics of world wheat prices on the change in domestic prices for this commodity in various countries in conditions of significant volumes of export-­import operations. Theoretical analysis has shown that, in accordance with the law of a single price, in conditions of perfect competition, domestic prices should change in proportion to fluctuations in world prices, whereas in conditions of imperfect competition, domestic prices will change to a greater extent than world prices. The analysis of correlations allowed us to determine that the wheat markets of the EU countries are characterized by a relationship between domestic and world prices with great statistical significance, for some countries this relationship was determined taking into account the time lag of world prices. The relationship between domestic and global wheat prices has not manifested itself, which is most likely a consequence of state interference in market processes, since the necessary prerequisite for the implementation of the single price law is the absence of active state regulation. Further research allowed us to establish that in the long term, domestic wheat prices in the EU countries change almost in proportion to the volatility of world prices. In the short term, the relationships turned out to be different for individual countries studied and independent of the share of wheat exports and imports in the country’s production and the average share of the country in world wheat trade.