Perspective: Morning Commentary for January 10

By: Arlan Suderman, Chief Commodities Economist

Tue, 10 Jan 2023, 14:25

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

January 10 – Stock futures turned lower overnight, following through on a reversal on Monday when the pendulum of market emotions swung from optimism to worry about rising interest rates once again. The VIX is trading near 22 this morning, reflecting slightly higher anxiety on Wall Street. The dollar index is notably higher, trading near 103.2, after falling to a fresh seven-month low on Monday. Yields on 10-year Treasuries are trading near 3.59%, while yields on 2-year Treasuries are trading near 4.25%. Crude oil prices are still hanging onto modest gains in early trade, while the grain and oilseed markets came under pressure overnight.

It didn’t take long for the excitement of Friday to turn into rate hike worries again on Monday. Traders focused on a single data point in Friday’s monthly jobs report suggesting that we might be seeing an easing of wage inflation, but that sense of optimism evaporated on Monday after two members of the Federal Reserve sobered up the market with comments refocusing the trade on this Thursday’s inflation data. They stated that Thursday’s consumer price index data will provide them better perspective on whether an easing of hawkish monetary policy is justified. The market will also focus on Fed Chair Jerome Powell’s comments this morning as he participates in a panel discussion. His comments might reassure Wall Street traders once again, or perhaps add to their rate hike fears. His initial comments seemed to reassure the trade. All of this shows how obsessed Wall Street has become with monetary policy. Former Fed Chair Ben Bernanke started this obsession when he moved the central bank toward greater transparency – a move that seemed noble indeed. Yet, the unintended consequence of this move toward transparency has become a single-minded focus on parsing every word coming from members of the Federal Open Market Committee. That focus to a great extent has displaced the market’s previous focus on a myriad of fundamental data points, increasing the volatility of the markets along with the emotional swings.

No ships left Ukraine ports on Monday, but that was largely due to adverse weather in the region. Shippers are still finding ways to get the insurance coverage they need to continue to move grain, albeit at higher costs. Russia continues to slow-walk inspections of ships – both prior to entering Ukraine waters, as well as after departing Ukraine ports before they head to their destinations as required by the grain initiative. As such, exports continue to flow out of Ukraine’s three approved ports, but at a limited capacity and at a higher cost. These exports provide much-needed revenue for the farm sector planning for its 2023 crop production cycle. Reduced revenues limit their ability to purchase crop inputs, leading many of them to rethink their crop mix for the coming growing season. Oilseed crops have a lower yield, but they generally also have lower input requirements, and their marketable value is much higher, especially on the export market. So, one of the unintended consequences of the war is to shift Ukraine from a largely wheat-producing nation that was also rapidly increasing corn output toward more of an oilseed producer, focusing largely on winter rapeseed, sunflowers, and soybeans. Wheat will continue to be grown in Ukraine, but it will play a smaller role in Ukraine agriculture as oilseeds grow in significance.

Exporters shipped 40.9 million bushels of U.S. soybeans to China in the week ending January 5. Shipments are trending lower as the availability of new-crop Brazilian supplies nears. China has already switched its purchases to new-crop Brazilian supplies, which will gradually become the dominant source of shipments as those supplies increase at Brazilian ports in the weeks ahead. Chinese buyers bought 21 cargoes of soybeans in the past week, as they extended coverage ahead of the Chinese Lunar New Year holiday that goes from January 21 to 27. Just one of those cargoes was purchased from the United States for immediate January shipment. Nineteen of the 21 cargoes were purchased from Brazil for February and March shipment and the remaining cargo was purchased from Brazil for June shipment. U.S. domestic soybean demand remains solid, but export demand is seasonally declining.

USDA will release its January set of crop reports on Thursday at 11 a.m. Chicago time. These January reports contain more data than any other release throughout the year, leaving the most opportunity for potential surprises. Look for USDA to modestly reduce Argentine corn and soybean production estimates on Thursday, with more significant cuts likely coming in February and March when confidence in lost production potential is greater. We could also see minor downward tweaks to Brazil’s production estimates, but nothing significant. Their crops still look big overall at this time. U.S. corn exports could see another significant cut, but feed usage may increase to offset some of that loss. I do not expect to see significant changes to the U.S. soybean balance sheet this month.

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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

Perspective: Morning Commentary for August 7

August 7 – The U.S. economy unexpectedly lost 23k jobs in July, dramatically below market expectations of an 80k increase and marking the worst Non-Farm Payrolls print since February. Furthermore, May and June were both revised sharply downward, with combined revisions showing 103k fewer jobs than previously reported. Outside of the healthcare sector, which added 22k jobs in July, the losses were very broad-based. Government payrolls saw the largest decline, shedding 53k jobs in July, the largest seen since October 2025, while June was revised down to show a loss of 10k jobs as well. The private sector at least saw growth, adding 30k jobs in July, now matching the month prior after it was revised down from the 49k initially reported, and substantially missing forecasts of 78k jobs being added. This is a sharp reversal in course from the largely better than expected U.S. labor data seen earlier this week.

Mike CastleFri, 07 Aug 2026, 13:26

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Morning Grain Comments 8-7

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Grains & Oilseeds

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