Perspective: Mid-Day Commentary for May 5

By: Arlan Suderman, Chief Commodities Economist

Fri, 05 May 2023, 15:11

Perspective: Midday Commentary

Arlan Suderman

Chief Commodities Economist

May 5 - Upbeat Apple earnings provide a lift on Wall Street, contributing to a modest "risk-on" day on the Street. The VIX is trading below 18, reflecting calm across Wall Street as we head into the weekend, lacking any fresh significant headlines from the banking sector to add to this week's worries. The dollar index is trading near 101.4, while yields on 10-year Treasuries are trading near 3.45%. Crude oil prices are trading 4% higher, and nearly $8 off yesterday's lows. The grain and oilseed sector is strong today as well, led by rising geopolitical risks in the Black Sea region that threaten food supplies in a world when supplies overall are still tight. As such, Kansas City wheat leads the way higher, as it has the strongest story currently, with very poor growing conditions in much of the Plains, arguing for another short crop this year, which will likely be confirmed by next Friday's USDA WASDE crop report. Soybeans will likely see tighter old-crop stocks as well, and corn is along for the ride, as blockage of shipments out of Ukraine would also tighten its supplies in the world. It's generally a positive money flow day thus far, at least until the next headline strikes from the banking sector to send money to the sidelines once again.

This morning's jobs report combines with many other recent reports to argue for continued rate hiking by the Federal Reserve, but there's a legitimate debate about whether that will be necessary. It's true that there is still a lot of money in the system that could quickly bring a resurgence of inflation back to this country. It's also true that wage inflation is still a big part of that equation, as shown by this morning's jobs report. However, Fed Chair Jerome Powell referred this week to the central bank's survey of bank loan officers. That survey found that many banks are tightening their requirements for loans. The graphic below shows a sharp rise in the percent of banks tightening standards for loans to large and middle-market firms, but similar trends are seen for loans to small firms, as well as auto loans and new credit card approvals. There may still be a lot of money in the system, but this rapidly changing trend toward tightening access to that money is expected to do some of the work of slowing the economy for the Federal Reserve. The primary question is, will it do enough of the work, or will it even possibly do too much of the work? That's the current debate in policy circles, as well as on Wall Street.

Wall Street is upbeat today. Apple's earnings report was good, as have been a number of the reports. Wall Street has already priced many of these risks into the market, and it is choosing thus far today to end the week on an optimistic note, with money generally flowing into both stocks and commodities. However, this week's events continue to provide a reminder that both stocks and commodities remain quite vulnerable to headline risk. As for the commodities, I continue to see crude oil as the lead commodity telling me when fund managers shift from economic concerns to supply concerns, with implications for much of the rest of the commodity sector as well.

Grains & Oilseeds

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Perspective: Morning Commentary for August 12

August 12 – Today’s focus is on inflation, with the July consumer price index data out this morning. We have this, and one more month of data, ahead of the next Federal Reserve meeting. Of course, headlines from the Middle East and the Black Sea wars also have an ongoing influence on the markets. Stock futures posted gains this morning, while the VIX traded just below 15. The dollar index traded near 99.7. Yields on 10-year Treasuries are trading near 4.66%, while yields on 2-year Treasuries are trading near 4.18%. WTI crude oil is trading near $83, while Brent trades near $88 per barrel. The grain and oilseed markets rebounded from yesterday’s losses ahead of today’s highly anticipated WASDE crop report that is due out at Noon Eastern Time.

Arlan SudermanWed, 12 Aug 2026, 13:33

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

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: Mid-Day Commentary for August 10

August 10 - Stocks traded quietly mixed to weaker through much of the morning as investors weigh Middle East war / peace headlines with artificial intelligence concerns / opportunities. Ironically, the VIX is trading near 15, putting it just barely above 2026 lows, despite the high level of geopolitical risks and AI concerns. The dollar index continues to consolidate largely between 99.5 and 100.0 after the late July break in what appeared to be Japanese central bank currency intervention. Yields on 10-year Treasuries are trading near 4.70%, while yields on 2-year Treasuries are trading near 4.24%. WTI crude oil is trading near $81 at this hour, while Brent trades near $87 per barrel on the geopolitical risks. The grain and oilseed markets are mixed ahead of Wednesday's big USDA WASDE crop report.

Arlan SudermanMon, 10 Aug 2026, 17:02

Grains & Oilseeds

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