Perspective: Mid-Day Commentary for December 13

By: Arlan Suderman, Chief Commodities Economist

Wed, 13 Dec 2023, 16:40

Perspective: Mid-Day Commentary

Arlan Suderman

Chief Commodities Economist

December 13 - The focus is now on the Federal Reserve, which is scheduled to release its updated monetary policy at 2 p.m. ET this afternoon, followed by a press conference 30 minutes later. Wall Street doesn't expect any change to interest rates or to the Fed's policy for shrinking the balance sheet in today's statement. However, its focus is on the Fed's forward guidance as analysts and traders look for evidence that policymakers are preparing for a pivot to lower interest rates. Every word will be parsed as analysts look for changes in the verbiage versus previous statements that might provide insight into discussions that took place in the board room the past two days.

Traders are waffling between a March and a May rate cut, while I contend that the first cut will come much later than that, unless we see a significant downturn in the economy between now and then. The Fed is also likely to do what it can to cool expectations that we will see significant cuts in 2024. Fed fund futures currently suggest that we could see 125 basis points in cuts by the end of 2024, and I just do not see that happening unless we see a significant downturn in the economy. Nonetheless, traders are so confident on Wall Street, that the VIX continues to trade near multi-year lows near 12 at midday, while the dollar index trades near 103.9. Yields on 10-year Treasuries are trading near 4.16%, while yields on 2-year Treasuries are trading near 4.67%. Crude oil prices are 1% higher on the day, after buying emerged on the overnight break to fresh five-month lows. The grain and oilseed sector is mostly weaker.

Soybean prices turned notably lower this morning, led in active selling of the January soymeal contract. Weather risks remain for Brazil, but today's focus is more on the sharp devaluation of the Argentine peso. Argentine farmers sell soybeans based on the U.S. markets in dollars, which are then converted to pesos. Soybeans sold for $13 yesterday, for example, would have garnered 4,745 pesos. The same soybeans sold for $13 today would garner 10,400 pesos. That is expected to increase farmer selling near-term, although there's not many soybeans left in the farmer's hands to sell following last year's drought. Yet, there is more wheat and corn in the farmer's hands. Both Chicago and Kansas City wheat futures traded sharply lower today, with Chicago probing below Monday's low. Corn prices are largely a follower to this point, which has been the case for some time amid disappointing export demand and big supplies.

U.S. commercial crude oil stocks (excluding the Strategic Petroleum Reserve) fell 4.3 million to 440.8 million barrels in the week ending December 8, putting them roughly 2% below levels normally seen in early December. Gasoline stocks rose by 0.4 million barrels, putting them also 2% below the five-year average for the week. Distillate stocks increased by 1.5 million barrels, but they remain 12% below seasonal levels. Ethanol stocks rose to a fresh 16-week high 22.1 million barrels in the week ending December 8, up from 21.4 million the previous week, but still below the 24.4 million barrels seen at this same point last year. Ethanol production slipped slightly last week to 1,074K barrels per day, down from 1,076K bpd the previous week, but above the 1,061K bpd in the same week last year. Estimated corn use for the production of ethanol totaled 108.1 million bushels last week, as shown below, down from 108.3 million the previous week, but up from 103.7 million the previous year. Estimated marketing year to date corn use for ethanol totals 1.463 billion bushels, up 45 million or 3.2% from the previous year's pace.

Grains & Oilseeds

This material should be construed as market commentary and represents the opinions and viewpoints of the author, and does not reflect tailored advice associated with any specific account.

The views are current only through the date stated and are subject to change at any time based upon market or other conditions, and StoneX Group Inc. (“SGI”) disclaims any responsibility to update such views. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. Past performance does not guarantee future results.

The StoneX Group Inc. group of companies provides financial services worldwide through its subsidiaries, including physical commodities, securities, exchange-traded and over-the-counter derivatives, risk management, global payments and foreign exchange products in accordance with applicable law in the jurisdictions where services are provided.

References to certain OTC products or swaps are made on behalf of StoneX Markets, LLC (SXM), a member of the National Futures Association (NFA) and provisionally registered with the U.S. Commodity Futures Trading Commission (CFTC) as a swap dealer. SXM’s products are designed only for individuals or firms who qualify under CFTC rules as an ‘Eligible Contract Participant’ and who have been accepted as customers of SXM.

StoneX Financial Inc. (SFI) is a member of FINRA/NFA/SIPC and registered with the MSRB. SFI is registered with the U.S. Securities and Exchange Commission (SEC) as a Broker-Dealer and with the CFTC as a Futures Commission Merchant and Commodity Trading Advisor. StoneX Financial (Canada) Inc. (SFCI) is registered in Canada and is a member of CIRO and CIPF. References to certain securities trading are made on behalf of the BD Division of SFI and are intended only for an audience of institutional clients as defined by FINRA Rule 4512(c). References to certain exchange-traded futures and options are made on behalf of the FCM Division of SFI. Wealth Management is offered through SA Stone Wealth Management Inc., member FINRA/SIPC, and SA Stone Investment Advisors Inc., an SEC-registered investment advisor, both wholly owned subsidiaries of SGI.

R.J. O’Brien & Associates, LLC (RJO) is registered with the CFTC as a Futures Commission Merchant and is a member of NFA.

StoneX Financial Ltd (SFL) is registered in England and Wales, company no. 5616586. SFL is authorized and regulated by the Financial Conduct Authority (FCA) (registration number FRN:446717) to provide services to professional and eligible customers including: arrangement, execution and, where required, clearing derivative transactions in exchange traded futures and options. SFL is also authorized to engage in the arrangement and execution of transactions in certain OTC products, certain securities trading, precious metals trading and payment services to eligible customers. SFL is authorized and regulated by the FCA under the Payment Services Regulations 2017 for the provision of payment services. SFL is a category 1 ring-dealing member of the London Metal Exchange. In addition SFL also engages in other physically delivered commodities business and other general business activities which are unregulated and not required to be authorized by the FCA.

This communication is issued in the European Economic Area by StoneX Financial Europe GmbH (SFEG). StoneX is the trade name used by STONEX GROUP INC. and all its associated entities and subsidiaries. StoneX Financial Europe GmbH (“SFEG”) is a securities trading firm registered in Germany under Company No. HRB 80844.

StoneX APAC Pte. Ltd. (“SAP”) (Co. Reg. No 200616676W) is regulated as a Dealer (PS20190001002) under the Precious Stones and Precious Metals (Prevention of Money Laundering and Terrorism Financing) Act 2019 for purposes of anti-money laundering and countering the financing of terrorism. SAP is an “Approved International Trading Company” authorized to act as a “Spot Commodity Broker” under the Commodity Trading Act.

StoneX Financial Pte Ltd (Co. Reg. No 201130598R) (“SFP”) is regulated by the Monetary Authority of Singapore and is a Capital Markets Service Licence holder (for dealing in capital market products), an Exempt Financial Adviser (for advising on investment products and issuing or promulgating analyses/ reports on investment products) and a Major Payment Institution (for domestic and cross-border money transfer services).

SFP may distribute analysis/report produced by its respective foreign affiliates within the StoneX Group of companies pursuant to an arrangement under Regulation 32C of the Financial Advisers Regulations Recipients should contact SFP at (65) 6309 1000 for any matters arising from, or in connection with, this webinar.

StoneX Financial (HK) Limited (CE No.: BCQ152) (“SHK”) is regulated by the Hong Kong Securities and Futures Commission for Dealing in Securities and Dealing in Futures Contracts.

StoneX Financial Pty Ltd (ACN 141 774 727) holds an Australian Financial Service License (AFSL: 345646) for Dealing in Securities, Exchange-Traded Derivatives Contracts, OTC Derivatives Contracts and Foreign Exchange Contracts, and is regulated by the Australian Securities and Investments Commission.

StoneX Securities Co., Ltd. (“SSJ”) (Co. Reg. No 010401047199) is regulated by the Japanese Financial Services Agency as a Type-I Financial Instruments Business Operator (Kanto Local Finance Bureau (FIBO)No.291’), is a member of the Financial Futures Association of Japan for dealing and broking FX and FX Option transactions, and is a member of the Japan Securities Dealers Association for dealing and broking stock indices and option transactions.

Trading swaps and over-the-counter derivatives, exchange-traded derivatives and options and securities involves substantial risk and is not suitable for all investors. Past performance of any futures or option is not indicative of future success. Indicators are not a trading system and are not published as a specific trade recommendation. The information herein is not a recommendation to trade nor investment research or an offer to buy or sell any derivative or security. It does not take into account your particular investment objectives, financial situation or needs and does not create a binding obligation on any of the StoneX group of companies to enter into any transaction with you. You are advised to perform an independent investigation of any transaction to determine whether any transaction is suitable for you. No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior written consent of StoneX Group Inc.

The report/analysis herein is not directed to, or intended for distribution to or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction where such distribution, publication, availability or use would be contrary to law or regulation.

Satellite view of Earth at night showing illuminated cities across Asia and the Middle East

Discover more insights

Our subscribers have access to comprehensive market analysis from StoneX spanning commodities, equities, currencies and more.

Explore subscriptions

What a Super El Niño Means for Food Inflation Over the Next Six Months

A strong super El Niño has started, but the crop damage that would lift food prices is still expected to land between September and December. Indian wheat area and Southeast Asian palm oil production sit at the front of the transmission chain, with Brazil the larger unresolved question.

Editorial TeamThu, 13 Aug 2026, 16:23

Grains & Oilseeds

Russian Wheat's Logistics Crisis Is Turning into a Production Problem

Damage to Black Sea ports has stalled grain exports, but the more serious risk is now forming on the farm. Collapsed farmgate prices and a Russian fuel crisis have put part of the wheat harvest in question.

Editorial TeamThu, 13 Aug 2026, 13:58

Grains & Oilseeds

Perspective: Morning Commentary for August 13

August 13 – The major stock indices traded quietly mixed overnight ahead of this morning’s weekly job numbers and producer price index data. Like Wednesday, this morning’s data was considered good as well, providing support for stocks while generally allowing Treasury yields to slip a bit lower. The VIX is trading near 14.4, which is just above yesterday’s new low for the year. The dollar index is trading near 99.8. Yields on 10-year Treasuries are trading near 4.64%, while yields on 2-year Treasuries are trading near 4.15%. WTI crude oil is trading near $81 per barrel, while Brent trades near $87 per barrel. Wheat prices again firmed overnight on geopolitical risks in the Black Sea Region, while corn and soybean prices pulled back modestly from yesterday’s big gains.

Arlan SudermanThu, 13 Aug 2026, 13:35

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

StoneX: We open markets

Our market expertise, advanced platforms, global reach, culture of full transparency and commitment to our clients’ success all set us apart in the financial marketplace.

Reach

With access to 40+ derivatives exchanges, 180+ foreign exchange markets, nearly every global securities marketplace and numerous bilateral liquidity venues, StoneX’s digital network and deep relationships can take clients anywhere they want to go.

Transparency

As a publicly traded company meeting the highest standards of regulatory compliance in the markets we serve, our financials and track record are matters of public record. StoneX’s commitment to “doing the right thing over the easy thing” sets us apart in the industry and helps us build respect, client trust and new partnerships.

Expertise

From our proprietary Market Intelligence platform to “boots-on-the-ground” expertise from award-winning traders and professionals, we connect our clients directly to actionable insights they can use to make more informed decisions and achieve their goals in the global markets.