Perspective: Morning Commentary for December 9

By: Arlan Suderman, Chief Commodities Economist

Fri, 09 Dec 2022, 14:42

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

December 9 – Stock futures turned notably lower following the release of this morning’s inflation data at the wholesale level as traders feared that it would lead to a more hawkish Federal Reserve. Yet, the VIX continues to trade near 23, where it has hovered for much of the past several days. The dollar index rallied sharply following the data release, but it has since settled back to trade near 104.9. Yields on 10-year Treasuries also rallied to trade near 3.54%, while yields on 2-year Treasuries are trading near 4.33%. Crude oil prices bounced off of yesterday’s 2022 lows to trade 1% higher at this hour. The grain and oilseed markets are quietly mixed ahead of today’s USDA WASDE crop report, scheduled for release at Noon Eastern Time.

The producer price index rose 0.3% month-on-month in November, exceeding analyst estimates of 0.2% growth. Furthermore, the October reading was also revised to 0.3% growth, up from the 0.2% growth originally reported. The headline PPI was up 7.4% year-on-year in November, beating analyst estimates of 7.2, but down from 8.0% the previous month. The core PPI rose 0.4% month-on-month in November, doubling analyst expectations of 0.2% and notably up from the 0.0% seen in October. Core PPI rose 6.2% year-on-year in November, beating analyst estimates of 5.9%, although down from 6.7% the previous month. We should see inflation data at the consumer level for November next week, but today’s data provides further evidence that inflation is not just grounded in food and energy costs, but it’s becoming engrained more deeply into the economy. Energy actually declined 3.3% on the month, which isn’t a trend that we can count on continuing, especially as we see China reopening its economy and many of our shale oil fields seeing developments that will make it more difficult for them to increase production going forward. We could very easily see energy inflation return in 2023 – perhaps in a significant way. Meanwhile, the decline in energy was offset by an increase in final food production costs, in part reflecting higher wage costs. Other gains were seen in the services sector, which is also labor intensive.

China’s President Xi Jinping completed his visit to Saudi Arabia today, where he met with leaders of many of the Arab nations. The meeting resulted in the signing of 34 energy and investment deals that are expected to strengthen the economic ties between China and the Middle East. However, observers noted that very little progress was made in several key objectives of the Chinese state, including changes that would profoundly reshape the global energy landscape and geopolitics. The meetings did not result in Saudi Arabia joining the BRIC nation coalition, nor was there notable progress made in agreeing to replace the U.S. dollar with the Chinese yuan in oil trading. Yet perhaps China was able to take the initial steps in trying to drive a wedge between the United States and Saudi Arabia.

Corn and soybean crops continue to advance toward maturity in Brazil in generally good condition. Areas of crop stress tend to hover between 10 and 20% of the crop growing areas, which is fairly typical for any growing season. The first of the soybeans planted in mid-September in Mato Grosso are expected to be harvested over the next two to three weeks, while more significant acreage will be harvested in January and February. It’s a different story in Argentina, where a multi-year drought remains in place. Argentina hopes to produce half a wheat crop this year, and that may prove optimistic. Wheat harvest will gain momentum over the coming days and weeks. Argentina has a long spring planting season, starting in October, and continuing into early February. One-third of the corn has been planted thus far, with the earliest of the corn now moving into pollination. The three-year average for planting progress is 47%. The crop is rated 18% Good to Excellent currently, versus 85% G/E a year ago. The soybean crop is 37% planted currently, down from the three-year average pace of 58% due to the drought. La Nina remains firmly in place currently, suggesting that we could see at least another four to six weeks of the current weather pattern. I’ve written a lot about how we could see Brazilian soybean production rise by 28 million metric tons this year, while the Argentine crop could see a decline of 16 to 18 mmt IF the current pattern lingers into the new year.

USDA is scheduled to release its WASDE crop report today. Look for it to make another modest cut to Argentina’s soybean crop, and perhaps corn crop in today’s report. Those cuts could become much more significant in January and February. Argentina’s wheat crop will also likely be cut some more, while Australia’s crop gets bigger. U.S. corn exports could be cut, partially offset by an increase in feed usage, while USDA will likely hold the line on most other U.S. balance sheet items – perhaps a modest cut in wheat exports. The bigger report will be in January, when much more significant changes to the domestic and global balance sheets are expected.

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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

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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