Perspective: Morning Commentary for November 18

By: Arlan Suderman, Chief Commodities Economist

Thu, 18 Nov 2021, 14:23

Perspective: Morning Commentary

Arlan Suderman

Chief Commodities Economist

November 18 – Stocks continue to trade in record territory, supported by strong earnings reports, solid economic data, and a healthy dose of fiscal and monetary stimulus. The VIX is trading near 17 this morning, while the dollar index pulled back from yesterday’s 16-month high to trade near 95.8. Yields on 10-year Treasuries are trading near 1.60% this morning. Crude oil prices fell to a fresh six-week low overnight, although they are currently posting modest gains once again. The Ags continue to find active buying interest, with the grain and oilseed sector adding to its recent gains.

First-time claims for unemployment benefits were essentially unchanged in the week ending November 13 at 268K, down slightly from 269K the previous week, but above analyst expectations of 261K. Yet, that drops the four-week moving average to 272.75K claims, down from 278.5K the previous week. Continuing claims rose 49K to 2.209 million people. The decline in people claiming unemployment benefits stalled in November, with the numbers slowly starting to rise once again.

The Philadelphia Fed manufacturing index rose to a strong 39.0 for November, up from 23.8 in October, and well above the 21.4 expected by analysts. The survey’s indices for general business activity, shipments and new orders all rose over the previous month’s levels. The employment index declined, but it remains elevated overall. The survey revealed broad price increases across the sector, continuing the inflation theme of the past year. The index for prices paid remained near its 42-year high posted last month. Survey participants were asked this month about anticipated price adjustments that they plan to make for their products. They generally reported that they expect to increase prices for their products by more than the anticipated inflation rate to keep up with their rising costs. Surveyed firms expect inflation over the coming year to average 5.0%, while they expect the 10-year average to be near 3.5%, both of which were up from the August survey when these questions were last asked.

New Covid cases fell to just six yesterday in China, which indicates that the country’s zero-tolerance policy is once again stamping out its latest outbreak. However, this cycle is expected to continue with increasing frequency at a considerable cost to its economy, and to the economy of the world. Today’s China Direct, published by our Shanghai office, provides another interesting twist to China’s battle with Covid. We’ve already documented its disputed position on cold chain risks for Covid-19 transmission on packages of frozen foods. Now we can add another twist. A story emerged in China today that someone in Liaoning received a package from relatives in the United Kingdom, and then tested positive for Covid. They alerted health officials, who tested the package, which allegedly tested positive for Covid. That would seem to contradict the known science to this point. However, China’s zero-tolerance policy suggests that health officials there will take this very seriously, possibly adding even more restrictions on packages that could further disrupt supply chains.

Spot soymeal futures are up by more than 6% over the past week as demand for the feed ingredient continues to rise. A shortage of lysine, and amino acid essential for feed rations, creates problems for livestock producers feeding distillers’ grains, which are deficient in the amino acid. As such, many are shifting back to soymeal in their rations. This shift is taking place across both Canada and the United States. The lysine shortage is the latest disruption creating inflation in the Ag commodities, while attracting outside money to the Ag sector as investors add the sector to their portfolios as a hedge against inflation.

Increased soymeal feeding boosted soybean crush margins, adding value to soybeans. Spot soybean futures rallied to their highest level since September on the soymeal strength, breaking through the top of a descending chart channel that had contained prices over the past five months in the process. That triggered buy-stops that added momentum to the rally, which triggered more buying by the Algo computers. The primary objective of the corn market is to protect its acreage for 2022 amid high crop input prices. As such, the corn market quickly responded to the soybean rally to maintain its needed advantage to sustain corn planting intentions for 2022. Minneapolis wheat prices faced a sharp sell-off starting on Monday to find a value that would re-establish demand after recent price strength had shut demand down. It didn’t take long before buyers started to respond to the price break, as global supplies of quality milling wheat remain tight. The Ag commodities maintain good support beneath them.

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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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