Perspective: Morning Commentary for April 14

By: Arlan Suderman, Chief Commodities Economist

Thu, 14 Apr 2022, 13:35

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

April 14 – Stock futures traded both sides of unchanged overnight, as traders positioned for this morning’s retail sales and jobs data, while looking ahead to the potential risks of holding positions through a three-day holiday weekend. The markets will be closed tomorrow for Good Friday as part of the Easter weekend holiday. The VIX is trading near 22 this morning, while the dollar index is trading near 100.2. Yields on 10-year Treasuries incredibly trade near 2.72%, which is well below the pace of inflation, yielding negative returns. Crude oil prices are down roughly 1% heading into the three-day holiday weekend. The Ags traded mostly higher overnight, although wheat and soybean prices pulled back following the release of disappointing export sales data this morning.

Retail sales data from March provided a mixed message that required a bit of translation. First, the headline number for sales came in at 0.5% month-on-month grains, falling below analyst expectations of an increase of 0.6%. But part of that was due to a big upward revision in the February number to up 0.8% gains month-on-month, up from the 0.3% originally reported. However, March retail sales minus autos rose by 1.1% month-on-month, beating analyst expectations of 1.0% gains, even though the February number was revised upward from 0.2% to 0.6% gains. Retail sales minus autos and gas rose 0.2% month-on-month in March, beating analyst estimates that they would fall by 0.1%, which is what they had done the previous month. We saw earlier this week that used car prices declined 3.8% month-on-month in March, which would have weighed on the headline number. Yet, sales exceeded expectations in March for core items outside of autos and gasoline, although part of that was because inflation of values for those items exceeded expectations as well. Other data released today revealed that we are also exporting inflation to other nations. Export prices rose 4.5% month-on-month in March and were up 18.8% year-on-year. Import prices rose 2.6% month-on-month, and they were up 12.5% year-on-year. Both continued to rise, showing few signs of “peak inflation.” The strong dollar further amplifies the inflation that we export.

First time claims for unemployment benefits rose to 185K in the week ending April 9, up from 167K the previous week, and up from analyst expectations of 175K. This raises the four-week moving average to 172.25K claims, up from 170.25K the previous week. Continuing claims of those still unable to find work was 1.475 million people, down 48K from the previous week. Continuing claims are the lowest in more than five decades, suggesting that we are very close to full employment, with more than 11 million job postings that employers are struggling to fill, contributing to significant wage inflation pressures. I see no signs of that problem easing, with the unfilled positions limiting the economy’s ability to grow.

China’s battle with Covid continues to be a significant factor for the commodity markets. Symptomatic cases in Shanghai nearly doubled yesterday to 2,573, while asymptomatic cases remained near unchanged at 25,146. This outbreak has essentially shutdown one of China’s premier commerce centers, characterized by a younger, out-going population that is fed up with being locked down, while also creating massive problems for manufacturing and exports. Meanwhile, Changchun, the capital of Jilin province, announced that it had reached the point of zero new locally transmitted cases, which allows it to begin to open up. News reports in state media seem to confirm rumors that China is experimenting with shortened quarantine periods to ease the impact on the economy. President Xi Jinping’s legacy is at stake as he approaches the October Party meeting that is expected to confirm him for a third term in office. He built his legacy around the zero-tolerance policy toward Covid that he believed would help China rise above the rest of the world. Omicron makes that a great challenge. The policy left China vulnerable with very little natural immunity, and its vaccines are less effective than those in the West. He may beat the current wave of Omicron, but there will be more waves. China cannot afford to continue with these cycles of lockdowns, but neither can it afford to open up. Expect massive stimulus packages to feed the economy in the meantime.

The Climate Prediction Center gives 59% odds of La Nina lingering through the Northern Hemisphere summer, which increases weather risks for U.S. 2022 production. First, it increases the risks for dryness in the Plains hard red winter wheat belt, where crop ratings are already among the lowest on record. Second, it increases risks that the drought in the Plains will spread into the Midwest as we go through the summer. Does it automatically mean that will happen? Not at all. Some well-respected forecasters expect a cool dry summer for the Midwest that could still boast good yields. But it does increase the risks in a year when global supplies are tight, with little to no margin for error.

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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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