Forming and developing the regional market of cereals under the influence of substitutes

Abstract

The paper examines the cereal market of the Republic of Crimea, which is characterized by the lack of testing of scientific approaches to assessing the regional market in terms of influence on substitutes’ demand and by pronounced seasonality of sales. The methodology is based on economic and statistical methods using correlation and regression analysis tools. The article determines the state of the Crimean market for goods based on official statistics, explores the dynamics of changes in production volumes of grain crops and their processing into cereals, and assesses the prices for goods of the group under study, presented in the retail trade network as well as the indicators characterizing the regional market of cereal products. The authors identify major Crimean manufacturers whose products are represented in the distribution network, and consider the factors influencing the development of the cereal regional market. Based on the results of the study, the study identifies the groups of substitutes that form the structure of consumer demand, including pasta and fresh vegetables. Drawing on correlation analysis, the authors establish the dependence of sales volumes of cereals on the prices of substitutes. Using regression analysis, the authors present the forecast for further development of the regional cereals market. The novelty of the study lies in determining the degree of dependence of consumer demand when purchasing cereal products on the prices of seasonal substitute goods. Finally, the study shows a direct effect of the demand for cereals on the prices of fresh vegetables, with a positive sales growth trend in the region, where sustainable economic and political situation will affect the prices for socially important food products.