Perspective: Morning Commentary for February 13

By: Arlan Suderman, Chief Commodities Economist

Mon, 13 Feb 2023, 14:22

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

February 13 – Good morning from Kansas City, where the sun is shining a bit brighter this morning. Stock futures are mixed to start trade on Wall Street this morning, although we’ll see a pickup in key data through the week that could either douse bullish embers or pour fuel on them. The data in those reports could set the tone, both for the commodities and for the equities going into the end of the month. The VIX is trading near 21 this morning, reflecting slightly elevated levels of fear on Wall Street, even as stocks show signs of optimism. The dollar index is trading near 103.7 in early trade. Yields on 10-year Treasuries are trading near 3.73%, while yields on 2-year Treasuries are trading near 4.54%. Crude oil prices are modestly lower this morning, while the grain and oilseed sector is mixed to weaker as well.

The flow of economic data picks up again this week. We’ll start with inflation at the consumer level when the consumer price index is released tomorrow morning. That will be followed by retail sales data for January on Wednesday, along with manufacturing data. Housing starts, weekly jobless claims, more manufacturing data, and more inflation data with the release of the produce price index comes on Thursday. The CPI, PPI, and retail sales data will likely shape market sentiment going forward. There are indications that the data may show some resiliency in retail sales combined with a flattening or even possibly increases in inflation data. The headline year-on-year CPI and PPI numbers are expected to show further reductions, but the month-on-month numbers are expected to turn upward once again, suggesting that inflation pressures are starting to get a greater foothold in the economy once again. That combines with other recent data to suggest that the Federal Reserve still has significant work to do in bringing down inflation to its mandated 2% level. Treasury yields are trending higher as a result, which in turn provides strength for the dollar.

Thursday’s weekly jobless claims report also needs to be watched. The weekly numbers remain relatively low but keep an eye on the continuing claims number. Inflation is most rooted in the service sector of our economy, which is very labor intensive and feeling the effects of wage inflation. Taming wage inflation means bringing the number of job openings in balance with the number of those people seeking a job. The latest data showed a little over 11 million job openings in our economy versus 5.7 million job seekers. Those two numbers need to come together. One of the key numbers I watch to see if we’re starting to bring those into balance is the weekly continuing claims number of long-term job seekers. That number was up to 1.688 million at the end of January, which is roughly 25% higher than its 52-week low. Every recession since at least 1970 coincided with a similar percent move. A little perspective is helpful here though. It’s easier to get a 25% move when that 52-week low is also a 50-year low. Nonetheless, the continuing claims number is trending higher overall, which may indicate that the Fed’s monetary tightening is starting to work, although it has a way to go in reaching its objective of taming wage inflation.

The military shot down three suspicious objects threatening U.S. airspace over the weekend, in addition to the Chinese balloon shot down last week. The U.S. Air Force says that it has not yet been able to identify the three objects shot down over the weekend, but the incidents continue to create public outcry against China’s spying activities. The latest object shot down on Sunday was floating at around 20K feet over Lake Huron. An object was shot down near Deadhorse, Alaska on Friday, and another over Canada’s Yukon on Saturday. We do know that the first one shot down off the South Carolina Coast last week was of Chinese origin, with listening devices suspended from it, although China claims that it was collecting weather information. Regardless, the increased incidences are pushing tensions between China and the United States to high levels once again. It has not thus far had a direct impact on the trade of commodities, but it does contribute to China seeking alternative sources to reduce its dependency on U.S. sources as much as possible. Brazil, as a member of the BRIC coalition, will be a key player in replacing U.S. exports to China.

Argentina’s weather forecast shifted drier again on Sunday, sustaining concerns about the size of its corn and soybean crops. The smaller corn crop should directly impact U.S. corn exports later this year, but the Brazilian crop is just now being planted. Argentina’s soybean crop is increasingly at danger of slipping below 40 million metric tons, with some private estimates already in the mid-30s. I believe it’s too early in the growing season to go that low yet, but I have no doubt that we could end up there or even a bit lower if drought pressures continue. That will be the question – do they continue through March? Is it logistically possible for Brazil to move 10 mmt of soybeans south to Argentine crush facilities combined with imports from Paraguay to offset the losses in Argentina? Yes. Will that actually happen? That’s yet to be seen. The Argentine government needs the tax revenues that come from exports of soymeal and soyoil, so it will try to make it happen. Meanwhile, U.S. soybean exports should drop off in the weeks ahead, while corn shipments rise. Look for this week’s inflation data to influence money flow in the commodity sector amid signs that we’re starting to build risk premium in the sector once again tied to inflation and to the Ukraine war.

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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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Perspective: Mid-Day Commentary for August 6

August 6 – Stocks remain quietly mixed at midday as both the S&P 500 and Dow Jones remain just below their fresh all-time highs put in yesterday. This is allowing the VIX to cool to a four-week low below the 15.4 mark, reflecting the collective sigh of relief in the market amid largely better than expected U.S. economic data today. The dollar remains quietly in the green in its relatively tight range this week, trading at 99.9 at the time of writing. Treasuries remain elevated but have cooled from their recent peaks, with 30-year yields trading at 5.189%, 10-year yields trading at 4.647%, and 2-year yields trading at 4.229% at midday. Crude oil also remains quietly in the green, with nearby WTI up 2.3% on the day trading near $76.80 and nearby Brent up 2.4% on the day trading near $81.40. The ags remain mixed, with the wheat complex now squarely in the red while corn and soybeans cling to small gains, and the livestock complex largely pushes lower.

Mike CastleThu, 06 Aug 2026, 15:18

Grains & Oilseeds

Perspective: Morning Commentary for August 6

August 6 – This morning’s stronger-than-expected U.S. labor data offered markets some relief, reinforcing confidence in the economy while giving the Fed greater flexibility to raise rates should inflationary pressures reaccelerate in next week’s July data. Stock futures are pointing to a mixed open to start the day, with the tech-heavy Nasdaq showing the most weakness. The VIX has fallen notably from yesterday’s spike above 18.4 as it starts the day hovering just below the 16-mark. The dollar is quietly higher as it trades just above 99.8, holding in the tight range seen thus far this week as traders continue to digest data to shape expectations for the Fed’s next move, which we’ll dive into in more depth below. Long-term treasury yields have relaxed slightly from their recent spike, with 30-year yields starting the day trading just above 5.19%, while 10-year yields trade above 4.64%, and 2-year yields sit below 4.22%. Crude oil is modestly higher to start the session after sharp declines earlier in the week, with nearby WTI up 1.8% to trade at $76.40 and nearby Brent up 2.4% to trade at $81.40. Meanwhile, the ags are quietly mixed to start the day.

Mike CastleThu, 06 Aug 2026, 13:24

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