The US War on Iran looks to be changing the dynamics of the commodity complex as a whole.
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Fear Of Inflation Long-term (F.O.I.L.) has sparked a rally in both commodities and the US dollar while US stock indexes and Fed fund futures fall.
Don’t Miss a Day: From crude oil to coffee, sign up free for Barchart’s best-in-class commodity analysis. Higher input costs - predominantly fuel and fertilizer - could lead to a larger than expected switch in US planted acres away from corn.
Last week, I had the opportunity to work with my long-time friend Myra Saefong of MarkeWatch again. We had a lengthy conversation via email spanning many days, as each sunrise brought something new to the commodity complex. The heart of Myra’s questions was consistent, though: “Can you (me) connect the dots between Iran closing the Strait of Hormuz, higher fertilizer prices, and global food security?” Sure. That seemed simple enough. However, as it turned out, the more dots I connected, the more dots were added to the puzzle. As we prepare to set sail into the great unknown of another week’s worth of trade Sunday, let’s look at how some of these dots fit together.
