Perspective: Morning Commentary for September 15

By: Arlan Suderman, Chief Commodities Economist

Thu, 15 Sep 2022, 13:28

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

September 15 – Stock futures had a weaker tone this morning ahead of a notable data dump, after which they briefly took on a bit of a firmer tone before softening again. Wall Street remains very subdued overall ahead of next week’s meeting of the Federal Reserve, which is expected to possibly produce even more hawkish actions from policymakers. The VIX eased lower to trade near 26 this morning, reflecting slight calming of the waters on Wall Street. The dollar index firmed to trade near 109.6, which keeps it just below recent 20-year highs. Yields on 10-year Treasuries are trading near 3.44%, while yields on 2-year Treasuries are trading near 3.84, with the inversion broadening wildly this week. Crude oil prices are nearly 2% lower, while the grain and oilseed markets were mixed overnight.

Retail sales rose 0.3% month-on-month in August, beating expectations that they would be flat during the month. However, the previous month was revised down to -0.4%, helping to push the August number higher relative to July. Retail sales minus vehicles fell 0.3% month-on-month in August, versus analyst expectations that they would be flat. July sales minus vehicles were revised to flat, after initially showing 0.4% gains. Sales minus vehicles and gas rose 0.3% month-on-month in August, down from analyst expectations of 0.6% growth. Here again, the July numbers were revised to 0.3% growth, down from 0.7% growth originally reported. The bottom line is that retail sales the past two months were stagnant, even with inflation inflating the numbers. In other words, stagflation risks are very real.

The Empire State Fed manufacturing index for September came in at -1.5, showing more contraction in the sector this month. However, the contraction was less than the -12.8 expected by analysts, and it was certainly less than the -31.3 posted for August. The Philadelphia Fed manufacturing index came in at -9.9 for September, down from 6.2 the previous month and below analyst expectations of 3.1. The bottom line is that the manufacturing sector is struggling in the current high cost, sluggish demand environment, and the optimism is low that we will see the sector turn the corner any time soon amid the current monetary tightening cycle. Afterall, the purpose of monetary tightening is to slow consumer demand and to elevate the unemployment rate.

First time claims for unemployment benefits slipped to 213K in the week ending September 10, down from 218K the previous week and well below the 228K expected by analysts. That dropped the four-week moving average for claims to 224K, down from 232K the previous week. Continuing claims as of the week ending September 3 totaled 1.403 million, up 2K from the previous week. It should be noted that the previous week’s total was revised down by 72K, which is a massive adjustment. This puts the number of long-term unemployed and unable to find a job just above 50-year lows, suggesting that the employment sector is still quite tight. In other words, the Fed will see this as an indication that it still has quite a bit of work to do yet in reducing wage inflation.

A tentative agreement between union workers and the railroads was reached overnight, possibly averting the first nationwide rail strike in 30 years. An agreement was needed essentially before midnight tonight to avert the strike. The agreement now goes to the rank and file of the union for ratification. There are few indications at this point how the rank and file union members will vote. But at the very least, the agreement delays any possible strike for a few weeks. The new deal reportedly offers an immediate 14.1% pay hike to make up for the time since 2019 that they’ve been working under the old agreement, with additional pay hikes over the next several years. But the biggest points of contention dealt with sick leave and other time off, with engineers and conductors currently said to be on call 24/7/365. Allowing for guaranteed time off in the current tight labor situation would necessitate a reduction in rail capacity, although we’re still lacking details on this part of the agreement. Regardless, it’s another part of the inflation cycle supported by wage inflation that the Fed is trying to address.

Corn and soybean traders can now focus on early harvest results over the next several weeks. This morning’s export sales data dump from USDA showed some decent soybean and soymeal sales over the past several weeks, but nothing overly impressive for this time of year. It’s difficult to compete on the global market with those assets for which customers have options. Argentina’s “peso sale” that offered 200 pesos for each dollar of farmer soybean sales yielded a dump of 5.7 million metric tons (209 million bushels) of the oilseed onto the market in the first week of the policy. China snatched up an estimated 20 cargoes of those newly sold soybeans for September and October shipment, reducing its need for U.S. supplies. Yet, that may have simply helped offset a smaller U.S. crop. The longer-term question will hinge around whether La Nina impacts Brazil’s upcoming crop, with planting beginning today in Mato Grosso and many surrounding areas. Favorable showers are increasing in Brazil’s Center-West region, supporting planting efforts, although it’s still unknown whether the favorable weather will linger to support the crop’s development in this La Nina cycle.

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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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