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Abstract
Since 2000, Russia has substantially increased grain production and exports. The grain
output growth has come from a rise in yields rather than area. After falling heavily during the
1990’s, grain area stabilized during the 2000’s and has remained flat, at about two-thirds the
level of the late Soviet period. Using data on the regional structure of Russian grain production
costs, this paper examines the country’s potential to increase grain output further by returning the
lost grain area to production. The analysis finds that if grain area were to grow beyond a certain
level, that is still well below the level of the late Soviet period, production costs would rise
steeply. Therefore, any major expansion in grain area would require that world grain prices rise
considerably beyond their level in the early 2010’s, to cover the high marginal costs of
production.