Perspective: Morning Commentary for August 25

By: Mike Castle, Market Intelligence - Fertilizer Analyst

Tue, 25 Aug 2026, 13:13

Guest Commentary by Mike Castle

Senior Commodities Economist

August 25 – Stock futures are pointing to a higher open, with the Dow Jones looking to add to yesterday's gains while the S&P 500 and Nasdaq looking at a turnaround Tuesday. The VIX is roughly unchanged to start the day, hovering in the mid 15.8’s at the time of writing. The dollar is quietly higher again, still attempting to find its footing near the 99.0 level after last week’s sharp selloff. Treasury yields are moving lower to start the day, with 2-year yields pushing below 4.21%, while 10-year yields push below 4.66%, and 30-year yields below 5.19%. This cooldown in yields, especially at the longer end of the curve, is certainly welcomed news for the market amid bigger picture concerns regarding the sustainability of U.S. fiscal policy, but we’ll have to see if it can last. Crude oil is sharply lower to start the day after yesterday’s announcement from U.S. Treasury Secretary Scott Bessent came in less aggressive than feared and increased expectations that the U.S. will seek to escalate economically rather than militarily, potentially translating to less risk of longer-term damage to supply in the region. Pakistan’s Interior Minister Mohsin Naqvi also noted that “significant progress” had been made in negotiations between the two sides, supporting ideas that these measures could act as a restart for more notable peace talks, though harsh rhetoric from Iranian officials do contrast with this. Nearby WTI is down 3.4% this morning, trading near $82.10, while nearby Brent is down 3.0%, trading near $87.80. Meanwhile, the ags are lower almost across the board despite a largely more bullish than expected USDA Crop Progress report after yesterday’s close.

U.S. Treasury Secretary Scott Bessent announced “Operation Economic Outcast” at his highly anticipated press conference yesterday afternoon, aimed at increasing economic pressure on Iran in order to bring an end to the stalemate but, all in all, details were somewhat lacking. Sanctions on roughly 60 entities, individuals, and vessels were announced, but the bigger escalation was the threat of more serious secondary sanctions on nations continuing to do business with Iran. The elephant in the room here is China. They are far and away Iran’s top trading partner, but Bessent was clearly very measured in refusing to mention China specifically, whether in his Sunday op-ed in the Financial Times or his prepared remarks at yesterday's press conference. Reporters took note of this, asking him directly about sanctioning Chinese banks or other entities, and he was again measured in his wording, responding simply “no one is above the reach of U.S. sanctions.”

He did, however, tease plans to sanction a “major” financial institution before the end of the week, raising speculation as to whether this could be a Chinese entity, or simply an Iranian-linked institution. In my own opinion, yesterday’s press conference appears to be something of a warning shot. It’s clear that the administration is trying to give China and other Iranian trading partners a window to wind down trade with Iran before escalation, but it will be critical to see if they actually use this window to comply or simply continue business as usual. Iran has spent decades perfecting the art of skirting sanctions and have a long list of partners in third-party nations that have helped make this possible, though it is intentionally hard to track and/or enforce. Chinese President Xi Jinping is scheduled to travel to the U.S. in one month, and yesterday’s announcement adds significantly more intrigue to the lead-up to that meeting, both in the commodity space and for the broader global economy.

U.S. corn conditions dropped 3% week-over-week to 57% good/excellent on yesterday afternoon’s Crop Progress report, much sharper than the anticipated 1% decline. This is now 14% behind the same week last year and 4% behind the previous five-year average, with the sharpest weekly declines being seen in North Dakota (-7%), Colorado (-7%), Ohio (-5%), and Nebraska (-4%). This gives the appearance that USDA employees were keeping a close eye on last week’s Pro Farmer Crop Tour and adds additional intrigue to next month's September WASDE to see if yields are cut further. Soybean conditions fell a lesser 1% week-over-week to now sit at 60% good/excellent versus the average analyst estimate of holding steady at 61%. This puts U.S. soybean ratings 9% behind this time last year and 2% behind the previous five-year average. Personally, I was a bit surprised to see USDA cut their soybean yield estimate on the August WASDE, and it will be interesting to see what direction they go in next month.

Spring wheat harvest is progressing rapidly, advancing another 21% week-over-week, notably faster than the average estimate of 16%, to now sit at 62% complete. This remains the fastest pace of spring wheat harvest seen since 2021, now sitting 11% ahead of this time last year and 10% above the previous five-year average. At the same time, U.S. spring wheat conditions unexpectedly dropped 1% to sit at 51% good/excellent, with top producer North Dakota’s 5% week-over-week decline more than offsetting the 7% gain seen in Montana and 6% gain seen in Idaho. On the winter wheat side, USDA did not publish any harvest progress data, signifying the official end of the season. Before we know it, the focus will shift to winter wheat planting season in the months ahead.

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Perspective: Morning Commentary for August 28

August 28 – New Fed Chair Kevin Warsh takes center stage today from the Fed’s annual Jackson Hole Symposium, due to provide his address in the next hour. The market will surely be parsing over his words with a fine-tooth comb, but it’s worth keeping in mind that his stated goal is for the Fed to provide less forward guidance and play a less prominent role, allowing the trade to “play the ball, not the referee.” With that said, my own expectation is to hear largely hawkish language as we did following the July Fed meeting as Warsh doubled down on the Fed’s stated commitment to its elusive 2.0% inflation mandate, which may drive volatility in rate expectations in the short-term, but keep in mind that expectations softened notably in the month that followed his hawkish comments. Not much has fundamentally changed since the Fed’s July meeting: inflation remains above target and the economy continues to expand, but a weak July payrolls report has introduced more concern around the labor side of the dual mandate. Yesterday’s jobless claims did give some renewed signs of resilience in the labor market to potentially aid in providing a permission signal to move rates higher, but I still expect the Fed to emphasize the need for patience. There is obviously plenty more impactful data on both inflation and the labor market sitting between now and the Fed’s September meeting, so much of the focus may also be attempting to discern longer-term changes to Fed strategy and positioning moving forward instead of just their immediate next step.

Mike CastleFri, 28 Aug 2026, 13:26

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Perspective: Morning Commentary for August 27

August 27 – The tech sector is breathing a collective sigh of relief, with the tech heavy Nasdaq poised for the biggest gains of the major indexes to start the day after impressive earnings results from Nvidia, Salesforce, and CrowdStrike after yesterday's close. This sigh of relief is also reflected in Wall Street’s fear index, with the VIX falling back below 15 for the first time this week. The dollar has slowly inched higher this week as it claws back portions of last week’s losses and is holding just above unchanged at the time of writing, trading just above the 99.16 level. Treasuries are quietly mixed to start the day, with 2-year yields down very slightly to trade at 4.222%, 10-year yields unchanged at 4.664%, and 30-year yields up slightly to trade at 5.188%. Crude oil is also just above unchanged to start the day, with nearby WTI up roughly 0.7% to trade near $82.50 while nearby Brent is up roughly 0.6% to trade near $87.50. The ags are largely mixed to start the day, with the wheat complex clinging to small gains while corn and soybeans are quietly lower.

Mike CastleThu, 27 Aug 2026, 13:21

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Perspective: Mid-Day Commentary for August 26

August 26 – It’s a quiet day on Wall Street despite the tranche of data released today, with focus shifting to chip giant Nvidia’s earnings report due out after today’s close. The major stock indexes are all quietly lower at midday, down anywhere from 0.25% to 0.35% at the time of writing, while the VIX remains muted as it hovers near 15.6. The dollar has firmed through the morning, reflecting some additional hawkish sentiment after this morning’s inflation data, as it trades at 99.17, its highest level since last Wednesday’s selloff. Treasury yields are working higher as well, with 2-year yields up to 4.23%, 10-year yields up to 4.668%, and 30-year yields up to 5.186%. Crude oil has reversed course from this morning’s losses to now trade in the green amid rumblings of more escalations in the Black Sea region as well as a more bullish than expected D.O.E. report this morning, with nearby WTI now up 2.1% on the day to trade near $82.80 and nearby Brent up 0.6% to trade near $87.80. The ags are surging higher at midday, with the wheat complex now leading the way higher amid additional concerns regarding supply from the Black Sea following wire reports stating Putin is planning escalation with Ukraine, though details to this point are scarce.

Mike CastleWed, 26 Aug 2026, 16:59

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