Perspective: Mid-Day Commentary for August 31

By: Arlan Suderman, Chief Commodities Economist

Tue, 31 Aug 2021, 16:20

Perspective: Midday Commentary

Arlan Suderman

Chief Commodities Economist

August 31 - It's relatively quiet on Wall Street as traders prepare to close the books on August, ahead of a three-day holiday weekend, with the markets closed for Labor Day this coming Monday. The equities are mixed to higher in quiet trade, while the commodities are generally weaker. The VIX is trading quietly just above 16, while the dollar index is trading near 92.7. Yields on 10-year Treasuries are trading near 1.31%. Crude oil prices are modestly lower at midday, while the Ags are mostly lower. Much of the weakness in the above two commodity sectors is being tied to the aftermath of Hurricane Ida.

Many oil platforms were shutdown in the Gulf as Ida approached, but the lost supply isn't currently impacting prices, because refineries were also shut down, reducing the demand for crude oil. Gasoline supplies are expected to tighten in the days and weeks ahead, especially for the eastern part of the country serviced by the Colonial pipeline. But today's focus is on the lack of demand for energy due to the shut down.

We're getting a better assessment of conditions in the ports of New Orleans today. Some facilities have extensive damage, while others do not. But the primary problem is a lack of power. Major transmission lines crossing the Mississippi River to provide power are down. It's estimated that it will take one to as many as two weeks to restore power to these facilities. Shipments are being rerouted where possible, but there's simply no inventory to speak of at other facilities to ship ahead of this year's harvest. That's how tight old crop supplies are following the past year's aggressive export campaign. The corn and soybean markets sold off on expectations that demand has been hurt, eventually doing technical damage on the charts that added to the selling as weak longs are squeezed out.

We will likely see USDA eventually cut back modestly its old-crop export targets for the year ending today due to loss of shipments the past several days. The export campaign will likely be negatively impacted into next week as well. However, we expect the basis market to aggressively move grain as we get into September to quickly fill the near-term deficit, leaving little impact on the longer-term balance sheets. We do not expect appreciable lost export demand as a result of the current shutdown. The only other notable supplier of soybeans would be Brazil, and U.S. shipments should be restored by the time Brazilian supplies could get into position. Corn shipments currently see less urgency than they would later in the year.

USDA's September 10 yield estimates will be the first of the year utilizing objective field sampling. The graphic below shows the history of changes to USDA's soybean yield estimates from the August to the September crop report over the past 28 years. The soybean yield increased in 15 of those 28 years in the September report, while falling 11 times and being unchanged twice. How did it change by the final estimate in January? The final estimate was likewise higher than the August estimate 15 times, and lower 13 times over the past 28 growing seasons.

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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