Perspective: Morning Commentary for April 21

By: Arlan Suderman, Chief Commodities Economist

Thu, 21 Apr 2022, 13:29

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

April 21 – Stock futures pushed higher overnight, supported by good earnings reports reflecting a resilient economy, while digesting the latest hawkish comments from the Federal Reserve. The VIX is trading near 20 this morning, reflecting relative calm on Wall Street. The dollar index is trading near 100.1 as it continues to slip lower from its recent two-year high. Yields on 10-year Treasuries are trading near 2.87% this morning. Crude oil prices are nearly 2% higher, while the Ags were mostly lower in early trade today.

First-time claims for unemployment benefits slipped to 184K in the week ending April 16, down from 186K the previous week, but notably above analyst expectations that it would fall to 175K. As such, the four-week moving average rose to 177.25K during the week, up 5K from the previous week. Continuing claims of those still searching for a job fell another 58K to 1.417 million in the week ending April 9, which is the lowest level for this key indicator since the week ending February 21, 1970, when continuing claims sat at 1.412 million. We continue to move closer to full employment, with more than 11 million job postings for this relatively small number of people searching for work, which continues to push wages notably higher.

The Federal Reserve finally got religion regarding inflation. We warned of the dangers of persistent inflation more than a year ago, but the Fed insisted that it was transitory – lasting a month or two. Acting at that point could have dramatically reduced the risks of more significant inflation, although it could not have totally eliminated it. Yet, a robust economy at the time could have managed inflation with fewer risks. Now the Fed is nearly in panic mode as it suddenly tries to convince the markets that inflation is enemy number one that must be dealt with quickly to avoid more significant consequences. Unfortunately, inflation has a tighter grip now than it did a year ago, and the economy is more vulnerable. Now some of the Fed’s most zealous doves are the most vocal hawks, speaking in recent weeks of the need to get aggressive. Those doves turned hawks would include Fed Governor Lael Brainard, San Francisco Fed President Mary Daly, and Chicago Fed President Charles Evans.

The doves are calling for the central bank to raise its benchmark rate to “normal” levels by year’s end. Some may argue regarding what “normal” rates are, but the message is clear. They want to see aggressive rate hikes this year. The market interprets that to mean that rates will increase by at least another 250 basis points over the next six meetings, with most of the hikes being at 50 basis points. There’s also an expectation that the Fed will decide next month to begin shrinking its balance sheet (withdrawing stimulus) at roughly $95 billion per month. Those are the numbers priced into the market currently, and it appears to have adjusted to that expectation. Now we need to see how the economy handles those unprecedented moves, if in fact that is what the Fed actually does.

Ukrainian farmers have planted more than 2.5 million hectares to spring crops thus far, which is 20% of the “expected” area, according to the Agrarian Policy and Food Department. It expects that 60 – 70% of those areas reclaimed from Russian troops can be planted, once they’re checked for land mines, etc. Just 30 – 40% of those areas that remain under hostile control are expected to be planted, including Luhansk, Donetsk, Zaporizhzhya, and Kherson oblasts. It continues to insist that most farmers purchased their required resources in advance, but we continue to believe that this is an optimistic outlook, with the availability of fuel, fertilizer, seed, and crop chemicals remaining limited. Farmers also face risks that Russian troops will return to destroy crops before they are harvested. Considering these conditions, the focus is on crops requiring the least resources, with little to no mention of corn planting to this point.

Ninety percent of Ukraine exports moved through its ports on the Black Sea, prior to the Russian invasion and blockage of ports. One-third of those shipments went to Europe, while two-thirds went to the Middle East, North Africa, and to Southeast Asia. Many of those countries had a 60- to 90-day food supply prior to the war. Current exports over land to the west total less than a tenth of the volume previously seen via the Black Sea, but they’re making progress. Shipments in the first 19 days of April totaled 320K metric tons, versus 415K for the entire month of March. This keeps global supplies tight, requiring that traders pay more attention to current dryness in the northern half of Brazil’s safrinha corn belt, as well as to planting delays in the U.S. Midwest and Northern Plains, along with the intense drought negatively impacting crop conditions in the Plains hard red winter wheat belt.

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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

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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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