Perspective: Mid-Day Commentary for April 22

By: Arlan Suderman, Chief Commodities Economist

Fri, 22 Apr 2022, 16:16

Perspective: Midday Commentary

Arlan Suderman

Chief Commodities Economist

April 22 - Stocks tumbled this morning as the war escalates in Ukraine and ahead of the May 3rd & 4th meeting of the Federal Reserve. A Russian general confirmed expectations in the West today that Russia's goal is to gain control of eastern oblasts of Ukraine, as well as all of its southern ports, which would put a strangle hold on Ukraine's economy. Meanwhile, traders are increasingly worried that the Federal Reserve will be too aggressive in withdrawing the candy jar of stimulus that has been so good to the markets over the past two years. The VIX rallied to a fresh five-week high near 26 as we approached midday, reflecting those rising fears ahead of the weekend. The dollar index put in a fresh two-year high near 101.3 as yields on 10-year Treasuries traded near 2.90%. Crude oil prices are more than 1% lower at midday, while the Ags are mixed. Most Ag commodities rallied early this morning when Indonesia shocked the world by banning the sale of palm oil. That sent the edible oils sharply higher, with soyoil posting fresh record highs. However, soymeal and soybeans sold off hard, with the Algos punishing the oilseed. Corn prices followed soybeans lower, despite big export sales to China and to Mexico. Wheat prices initially followed, but then rallied again when Thursday's lows held. Live cattle futures are pulling back ahead of this afternoon's big USDA cattle-on-feed report.

NOAA's Climate Prediction Center made headlines this week when it released its outlook for the summer. The graphic below provides a statistical analysis of its confidence level for precipitation in June, July, and August. The darker browns, with indices close to "1", reveal where the CPC has its highest confidence levels that the area will see below normal rainfall this summer. This is a very daunting forecast, which is rarely seen from an agency not known for being willing to stick its neck out on long-range forecasts. Its forecasts tend to be more conservative, so this one really turned heads.

Will this forecast happen? It may, but the pieces are not yet in place for that to happen. Based on our study of history, several things probably need to come together in the weeks ahead to make it happen. That would include 1) increased cooling of waters in the northwestern Pacific into the Gulf of Alaska down the west coast of the United States, 2) lingering La Nina in the equatorial Pacific (although this one isn't as critical), and 3) establishment of the summer high pressure ridge along the eastern Rocky Mountains, or further to the east. The next 30 - 45 days are when we'd expect these things to come together, if they're going to happen, based on my conversations with respected climatologists. On the other hand, you can move the below brown shaded areas further west if the high pressure ridge forms further west in the Great Basin, or move it further east to cover more of the Midwest if it moves out into the Plains. One other item to note. Our bumper crops with above-trend yields tend to come from early-planted crops. We are greatly reducing the odds of that happening this year, although we are still very much in play for trend yields, depending on how the above does or does not play out.

The statistical confidence in a western Midwest dry summer is high. SOURCE: NOAA Climate Prediction Center

Grains & Oilseeds

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Perspective: Morning Commentary for August 11

August 11 – It was generally a quiet night for the markets until early this morning when a headline hit that Iran and Oman were close to reaching a deal. Stock futures rallied, while the dollar index followed Treasury yields lower, along with active selling in the energy- and food-based commodities. The headline had limited impact though in a world that has become skeptical of promises of peace. Stock futures remain steady to firmer at this hour, while the VIX trades near 16 – just above 2026 lows. The dollar index is trading near 99.8 this morning, after recovering from its early morning selloff over the following hour of trade. Yields on 10-year Treasuries are trading near 4.69%, while yields on 2-year Treasuries trade near 4.22%. WTI crude oil is trading near $82 per barrel at this hour, while Brent trades near $88. The grain and oilseed markets are mostly weaker, after failing to recover from this morning’s early selloff that started in the crude oil market.

Arlan SudermanTue, 11 Aug 2026, 13:21

Grains & Oilseeds
Energy
Dairy
Renewable Fuels
Cocoa
Coffee
Cotton
Sugar
Meats & Livestock
Forest Products

Perspective: Morning Commentary for August 10

August 10 – The world commodity markets and economy remains at risk amid two wars this morning. Tensions continue to escalate in both the Middle East and the Black Sea – risking pulling other countries into the conflicts. Stocks are down modestly this morning as we start a week of trade in which we’ll see key inflation and retail sales data following a weak jobs report this past Friday. Yet, stocks continue to trade just below record high levels, with the VIX trading near 2026 lows just above 15. The dollar index is trading near 99.7. Yields on 10-year Treasuries are trading near 4.68%, while yields on 2-year Treasuries are trading near 4.23%. The energy and food-based markets are firmer today amid the escalated risks. WTI crude oil is trading near $80, while Brent trades near $85 per barrel. Double-digit gains in the winter wheat markets lead the way for higher grain and oilseed prices.

Arlan SudermanMon, 10 Aug 2026, 13:51

Grains & Oilseeds
Energy
Dairy
Renewable Fuels
Cocoa
Coffee
Cotton
Sugar
Meats & Livestock
Forest Products

Perspective: Mid-Day Commentary for August 7

August 7 – Stocks are looking to end a strong week on a strong note, with the major indexes all in the green at the time of writing. The VIX touched a nearly seven-month low earlier in the session and remains muted as it hovers just below the 15-mark as this morning’s ugly labor market data helps ease hawkish Fed jitters. The dollar has rebounded from its nearly two-month low earlier in the session but remains in the red on the day, trading at 99.55 at the time of writing. Treasuries have had a very volatile day, with yields tanking following this morning’s Non-Farm Payrolls release but bouncing back into midday, with 30-year yields now trading at 5.209%, 10-year yields trading at 4.654%, and 2-year yields trading at 4.204%. Crude oil has risen from the morning lows as traders eye the weekend market closure for potential geopolitical developments, with nearby WTI now down only 0.2% on the day to trade around $78.10 and nearby Brent breaking into the green, up 1.25% on the day to trade above $83.50. The ags are largely mixed, with the grains and oilseeds mostly in the green, save for a mixed picture in the soy complex, while live and feeder cattle futures move in opposite directions, with the former adding to yesterday’s sharp losses and the latter attempting a rebound.

Mike CastleFri, 07 Aug 2026, 17:09

Grains & Oilseeds

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