May canola is up $1.00/mt with July canola up $.60/mt, July soybean oil is up .23 cents/pound, August European rapeseed is up 5.50 euro per mt and July Malaysian palm oil is up .24%. July oats are up 2 1/2 cents/bushel. June crude oil is up $2.14 per barrel, June ULSD is up $.1364 per gallon, and the June Canadian dollar is up .00280 at .73605. The June U.S. Dollar Index is down .154 at 98.210 and the May Brazilian real is up .00115 at 0.20085.

The market seems to be taking Iran's position that their nuclear program is non-negotiable when it comes to initial peace talks seriously, and not just a deferred topic as some media suggests (which of course is unacceptable to the U.S.). Add in an apparent breach of the ceasefire between Israel and Lebanon with Israel reporting that they have begun targeting Hezbollah infrastructure in southern Lebanon -- and you get energy prices making new highs on the day by midmorning. With President Trump expected to meet with his top national security officials today, an escalation appears more likely all the time. Especially given Iran's stance that they believe their military should have control over the Strait of Hormuz while Marco Rubio reiterates that the U.S. can't tolerate such a normalization.

Grain and oilseed markets have rallied on the developments (or lack of) with soybeans leading the oilseed complex higher as soybean meal takes over leadership from soybean oil. Canola is relatively subdued thanks to the modest increase in soybean oil price and a strong Canadian dollar. Corn was leading the grains higher, but wheat has decided to put in a strong showing of its own. It is worth noting that the July corn contract has been the outperformer and if that bull spreading continues, it could be a sign of tightening supplies and stronger cash markets thanks to the record demand.

In outside markets, stocks and bonds are both quietly lower in a sign of concern over the higher-for-longer energy outlook. Meanwhile, the U.S. dollar remains marginally lower on the day.

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