Perspective: Morning Commentary for April 8

By: Arlan Suderman, Chief Commodities Economist

Fri, 08 Apr 2022, 13:33

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

April 8 – Stock futures are mixed as traders position for the weekend focused on more sanctions on Russia and rapidly rising interest rates amid talk of the Fed withdrawing stimulus from the economy. The VIX is trading near 22 this morning, reflecting elevated concerns for the economy, but a lack of panic. The dollar index probed above 100.0 as we started the day for the first time in 22 months. Yields on 10-year Treasuries hit a fresh three-year high 2.73% this morning. The above supported money flow into the food and energy-based commodities as a hedge against rising inflation amid increasing talk among some analysts on Wall Street that the commodity bull may have plenty of energy left in him. Supplies of many of these commodities are tight, and the threats remain active and very real. Crude oil prices, along with grain and oilseed prices, traded modestly higher overnight.

The U.N. Food price index hit a record high in February, taking out the previous high from a decade earlier when high food prices helped initiate the Arab Spring. The index jumped another 13% in March from its February record, as food shortage fears rapidly spread following the Russian invasion of Ukraine. High food prices raise fears among government leaders around the world, leading them to alter policies to hoard supplies. They understand that high food prices create social unrest, which can topple governments in today’s social media world. But the hoarding of food tends to tighten supplies even more, creating fear among buyers that they will not get what they want or need. That’s the phase that the world currently finds itself in, and that it will likely continue to be in for much of this year, and possibly the next.

Another man-made food shortage is playing out in Shanghai, along with other cities in China currently in lockdown due to the Omicron variant of Covid spreading through the land. People living in China’s financial capital of Shanghai are struggling to get food as the city remains in a virtual lockdown due to Covid. Many food delivery workers are confined to their homes, or they choose not to work for fear of catching the virus. Private deliveries are banned in some areas of the city due to fear that those individuals could spread the virus. Residents are running low on food after the lockdown has gone on much longer than it was first scheduled. Government authorities are responding to the pleas for help by allowing some grocery stores to reopen, while encouraging delivery drivers to return to work. The next step in human psychology is stockpiling and hoarding as consumers seek to gather as much supply as they can to avoid a repeat.

Meanwhile, unrest continues to grow as stories circulate of babies and small children taken from their parents who may have tested positive, with the children then being taken to over-crowded facilities that lacked sufficient staffing for caring for the children. The above occurs with increasing frequency as tens of thousands of people test positive each day with no visible symptoms, but they are still subject to the same quarantine requirements. Shanghai is a major export terminal for goods produced in China, but truck volume to move goods to the ports is running just 15% of normal, adding to global supply chain problems. This is largely a product of China’s zero-tolerance policy toward Covid-19, but it probably feels that it has few alternatives due to the lower effectiveness of its vaccines and its lessor developed healthcare system.

Mixed messages continue to flow out of Ukraine, and that’s normal in the fog of war. The Ministry of Ag recently stated that this year’s production will be roughly half of normal due to the challenges created by the Russian invasion of Ukraine, but it made no mention of exports. We considered that an optimistic outlook. Today, the Ukraine government stated that production will be down by 20% this year, and we consider that extremely optimistic. Other data today revealed that Ukrainian Railways moved 924K metric tons of grain in March. Of the total, 416K mt were moved for export. However, just 222K mt moved across Ukraine’s western border in March, while the remainder moved toward the ports to hopefully be exported once the war has ended.

USDA will release its April WASDE crop report at 11 a.m. Chicago time today. Few surprises are expected, and hopefully that will be the case. Corn and soybean crop ratings dropped notably in Argentina this week as the harvest progresses, so we could see downward adjustments in production there. Brazil’s soybean crop should also shrink. It’s corn crop should be flat, to a bit higher, but this may be the highest corn number we see going forward, as a dry pattern has set up for pollination and early grain fill in Mato Grosso and surrounding areas. The above adjustments could result in modest increases in U.S. exports, but we could very easily see USDA wait to make more significant changes until the May 12 report, when it will also add in its first look at the 2022-23 domestic and global balance sheets. That report will be one of the most significant of the year, as it should provide the biggest indications to date of the impact of the Ukrainian war on global food supplies. I anticipate that USDA will give Ukraine the benefit of the doubt, taking it at its word that it will be able to produce and export grain in the year ahead, but that may be the most optimistic outlook that we see going forward as the reality of war plays out amid mounting shortages of food and fertilizer.

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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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