Market euphoria last week over European leaders agreeing on a debt fighting package shifted back to worries early this week as traders watch to see if plans can be turned into reality.
Europe hopes China, North America, other countries in Asia and fast developing regions will invest in the debt stability fund, but it will be a tough sell. Other developed countries have their own problems and fast developing countries such as China and Brazil still have huge numbers of poor people much worse off than Greeks.
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We’ll hear lots about this as the Group of 20 richest countries meet in France this week to discuss how to revive the global economy.
The European situation is probably the biggest factor in grain prices these days, but there are also fundamental supply and demand issues to watch.
U.S. grain exports last week were surprisingly low. If that marks the start of a trend, it will pressure grain prices lower.
Worries about the U.S. winter wheat crop are lessening as timely rains reach Kansas, but rains are also hitting the Australian harvest, raising the spectre of another large, but low quality wheat crop there.
India has raised the minimum support price for several crops, and pulses in particular are benefiting.
The Indian government has a plan to boost winter, or rabi, pulse production by 2.78 million tonnes to offset the projected summer, or kharif, shortfall of 700,000 tonnes on account of lower acreage in several states.
The support is expected to increase pulse production in India, butStat Publishingeditor Brain Clancey notes that the minimum price in India is now higher than imported pulses. This could encourage additional lentil imports from Canada.
