Perspective: Morning Commentary for May 19

By: Arlan Suderman, Chief Commodities Economist

Tue, 19 May 2026, 13:21

Today's Perspective Video: Corn, Soybean & Wheat Prices Rally on China Announcement

May 19 – High interest rates and a defiant Iran created downward pressure on stock futures overnight. Yet, the VIX remains stable near 18 this morning, while the dollar index trades near 99.3. Yields on 10-year Treasuries are trading near 4.64%, while yields on 2-year Treasuries are trading near 4.09%. WTI crude oil is trading near $108 per barrel, while Brent trades near $110 per barrel. Gains in the grain and oilseed sector were more modest overnight, but mostly positive nonetheless, as money flows into a sector expected to gain from last week’s summit in Beijing.

Iran’s latest peace proposal reflects defiance – a refusal to yield on any U.S. demands. Iran seems to have back tracked on previous progress in negotiations, now demanding that it be able to maintain its uranium enrichment, receive reparations for the war, bring an end to all fighting against it and its proxy groups, release all frozen funds, and removal of all U.S. military forces from the area. This follows a Truth Social post by President Trump on Monday afternoon stating that the leaders of Qatar, Saudi Arabia and the UAE had requested that he hold off a military attack on Iran scheduled for today because, “a Deal will be made, which will be very acceptable to the United States of America, as well as all Countries in the Middle East, and beyond.” Caution is always advised in interpreting comments in the “fog of war,” but the rhetoric suggests that the two sides are still far apart, raising the risk of renewed active military action against Iran that supposedly was going to start today. The bottom line is that there is little evidence that the Strait of Hormuz will open any time soon, and that means that global energy and fertilizer deficits will continue to build. The energy shortages are expected to become more acute in June and July – especially in Asia. The fertilizer story is more of one for the 2027 global crop cycle, with some localized exceptions.

I fully expected a trade agreement to come out of last week’s summit between President Trump and President Xi, and we got one. I have to admit that I started to doubt when Trump returned home on Air Force One without an announcement, but I still leaned toward seeing one in the days ahead. We still don’t have the details that we’d like to see, nor has China confirmed what the White House has thus far posted. But that’s not unusual for trade agreements with China. I remain a skeptic on whether China will fully follow through on this agreement. Annual purchases of $17 billion in Ag products above and beyond the soybean commitments made last October would rank up there as one of the larger Ag trade agreements with China on record. China doesn’t have a good track record for following through on trade agreements, although it surprised me by doing so with the October agreement to this point. Yet, Trump and Xi are expected to meet several more times this year, which will increase the odds of compliance. China’s economic data is turning downward once again, indicating that Xi needs support from Trump to help him gain the renewed confidence of Party leaders so that he can serve another term in office.

China’s April retail sales came in sharply below expectations. The market anticipated 2% growth, but the official data fell to just 0.2%, well below 1.7% growth in March. The category breakdown was alarming as well, with major big-ticket items suffering steep double-digit losses – autos plunged 15.3% (vs -11.8% in March), home appliances fell 15.3% (vs -5%), and furniture dropped 10.4% (vs -8.7%). Electronic devices, the sole outperforming category that saw over 20% growth in previous months, lost momentum, falling sharply to 6.2% in April. Catering sales mirrored the downward trend, slowing to 2.2% in April, down from 2.9% in March. The consumer market decelerated faster than expected despite a moderate rise in consumer inflation. Longer term increases in energy prices pose a significant risk for China’s attempts to stabilize its already fragile consumer market.

Industrial output also fell short of expectations, with growth of 4.1% YoY in April, below 4.7% in March and the expected 5.9% growth. This fell short of 4.7% growth in March and the anticipated 5.9% pace, marking the slowest growth since July 2023. The slowdown underscores lingering stress from high energy prices, overcapacity, and overall fragile domestic demand. While the broader manufacturing sector decelerated to 5.8% growth, down from 6.4% in Q1, the high-tech segment maintained impressively strong growth at 12.6%. Yet, the official unemployment headline sent a conflicting signal, stabilizing at 5.2% in April, down from 5.4% in March and 5.3% in February.

So China has incentive to buy Ag commodities from the United States to get the tariff reduction it needs for accessing the much larger U.S. consumer market so that it can right the ship with its economy. We don’t know if it will hit the target on purchases. I remain skeptical. We don’t know the make up of the purchases either. Spreading that $17 billion over many commodities merely raises the floor under the markets. Focusing it on a few commodities creates a possible bullish demand scenario. Fund managers are afraid to be short any of the potential commodities until they know more about what China will do, resulting in the initial price strength witnessed this week.

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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

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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

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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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