November canola is up $18.00/mt, December soybean oil is up .43 cents/pound, November European rapeseed is up 7.75 euro/mt and October Malaysian palm oil is down .19%. December oats are up 2 1/2 cents/bushel while November European corn is up 2.50 euros/mt. September crude oil is up $.81/barrel, September ULSD is up $.0405/gallon, and the September Canadian dollar is up .00400 at .71880. The September U.S. Dollar Index is down .368 at 99.440 and the September Brazilian real is up .00050 at 0.19540.

Grain and oilseed markets have added to overnight gains for the most part with canola being the highlight of the morning. No news is readily available to explain the building rally other than the CGC weekly Grain Statistics report showing both canola exports and domestic use exceeded AAFC annual estimates as of the end of week 51. With a final week to go, both estimates will clearly need to be revised higher in future updates with lower ending stocks being the result. European rapeseed and soybean oil have also added to overnight gains so the rally in energy markets can likely take some of the credit.

Anxiety ahead of the weekend could be helping energy prices build on overnight gains given the lack of options available to reopen the Strait of Hormuz peacefully. Inflation concerns may be building as well after the surprising employment update.

A very weak July payroll report clearly impacted outside markets, but may be helping the commodity complex as well. U.S. jobs declined 23,000 when an increase of 80,000 was expected. Worse yet, revisions to the previous two months wiped out an additional 103,000 jobs. Helping the Fed avoid interest rate increases even more was a slower-than-expected increase in average hourly earnings. The unemployment rate surprisingly fell to 4.1% from 4.2% last month and expected levels due to a decline in the participation rate. All suggesting the last thing the Fed should do from the point of view of the employment aspect of their dual mandate is raise interest rates. With the problem being, that leaves the other part of their dual mandate (being inflation) left unchecked.

With the surprising results, stocks jumped sharply and treasuries rallied (but not as much as should be expected). The U.S. dollar sold off and commodities across the board got a boost.

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