Perspective: Morning Commentary for April 28

By: Arlan Suderman, Chief Commodities Economist

Thu, 28 Apr 2022, 13:27

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

April 28 – Stocks again tried to rebound overnight, ahead of this morning’s U.S. GDP data for the first quarter, but traders remain concerned about next week’s anticipated Fed actions, along with the Chinese Covid-related lockdowns and the escalating war in Russia. The VIX dipped just below 30 late on Wednesday, although it’s back to trading around 30 following this morning’s data release. The dollar index put in a 19-year high above 103.9 this morning, while yields on 10-year Treasuries trade near 2.87%. The strong dollar and the elevated fear level seen in the VIX create more headwinds for the commodities, but some of them continue to have strong enough fundamental stories to hold their strength, making them even more appealing to fund managers looking for a hedge against inflation at 40-year highs. That’s not the case for crude oil this morning, which again shows modest losses, but most of the grain and oilseed markets managed to post modest gains this morning.

U.S. gross domestic product shrank at an annualized rate of 1.4% in the first quarter of this year, after growing by 6.9% in the previous quarter. Analysts had projected a modest 1.1% growth of GDP in the first quarter. As such, today’s headline GDP number is sobering, suggesting that the Fed finds itself looking squarely into the face of stagflation – a stagnant economy with high inflation. But the headline number may not be painting a true picture of what’s going on in the economy. I still believe that stagflation is a risk for our economy, but I don’t know that today’s data necessarily says that we’re there.

Today’s headline number slipped negative largely due to a wider trade deficit, which is a problem of its own, combined with a moderate pace of inventory accumulation. Retail inventories grew by 2.0% in March, according to data released yesterday, while wholesale inventories grew by 2.3%. That can be an indication of a slowdown in consumer buying, or it can reflect a more robust increase in production to build inventories for anticipated future sales. Recent business surveys give some credence to the latter. This morning’s data reported that first quarter personal consumption expenditures increased by 2.5% in the first quarter on an annualized basis. That was below analyst expectations of 3.4%, but it was a decent enough number that also matched growth in the previous quarter. Overall, consumer spending was solid in the first quarter, and business investment in equipment rose sharply, suggesting that businesses are not worried about the consumer pulling back purchases, but rather that they have a sense of optimism about the future. This morning’s weekly jobless numbers were also positive.

First-time claims for unemployment benefits slipped to 180K in the week ending April 23, down from 185K the previous week, and slightly below analyst expectations of 181K claims. Even so, the four-week moving average rose slightly to 179.75K claims, up from 177.5K the previous week. Continuing claims slipped by 1K to 1.408 million, which is a new 52-year low. As such, the employment numbers would also suggest that the economy is doing well. The Federal Reserve will balance the employment data with the above GDP data and considerable other data available to it when it reaches its decision on monetary tightening next week.

The broader trend remains steady to higher for the grain and oilseed sector, supported by a combination of solid supply and demand fundamentals and inflation play by fund managers taking advantage of those fundamentals. Headwinds are increasing with the dollar now trading at 19-year highs, and the VIX showing elevated fear levels. Yet, the market reflects solid demand with risk for more supply shocks in the weeks and months ahead. Soils continue to dry out across much of the northern half of Brazil’s safrinha corn belt as the crop moves through pollination and early grain fill. The monsoon season is coming to an end, reducing the opportunities for relief going forward. A major crop failure is not expected but updated private production estimates beginning to come out starting next week may start to show some declines. Further north, planting delays are mounting in the United States, with more of the same into early May. I still expect the crop to get planted, but the lack of early planting likely eliminates the opportunity for a larger-than-trend crop. China appears to be taking note of these risks as it steps up purchases, buying another 18.7 million old-crop and 24.1 million new-crop bushels overnight. This comes on top of this week’s record high canola and soyoil prices as Indonesia bans oil exports, spring wheat planting delays in the Northern Plains and deteriorating hard red winter wheat conditions in the central and Southern Plains. Wheat exports are limited to those countries that have a freight advantage, but that demand rationing may prove necessary if the current crop prospects continue to shrink.

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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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Morning Grain Comments 8-7

Morning Grain Market Comments - Matt Zeller

Matt ZellerFri, 07 Aug 2026, 11:56

Grains & Oilseeds

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