The Weekender

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A Democratic sweep changed the policy outlook, crude posted its worst week since 2020, and a stronger-than-expected jobs report raised the odds of another rate hike. Grains stayed under pressure ahead of next Wednesday’s WASDE, although strong weekly soybean shipments offered some support.

The post-election stock rally gave way to an AI-led selloff, while crude lost much of its war premium. For farmers, lower oil prices have yet to bring much relief at the diesel pump. Cheap U.S. natural gas is helping nitrogen producers’ margins, but fertilizer bills remain higher than a year ago.

The election raised questions about AI investment. After Democrats won control of Congress, investors focused on what the result could mean for AI data-center construction. The Nasdaq fell 5.5% Thursday and lost 3.4% for the week. Any change in trade policy will take time; most newly elected officials take office in January.

Strong jobs data raised rate-hike expectations. October payrolls rose 165,000 versus 65,000 expected, unemployment held at 4.1%, and August and September were revised up by a combined 84,000. The dollar and two-year yield rose Friday as traders increased bets on a December rate hike.

Crude had its worst week since 2020. WTI settled at $90.83, down 12.8% for the week; Brent closed at $98.32, down more than 16%. The election result raised hopes for an end to the Iran war, but no agreement is in place and flows through Hormuz remain at risk.

Diesel is off its highs but still pricey. EIA’s on-highway average was $6.29 a gallon for the week of Nov. 2, down from the $6.53 record but still 68% above last year. ULSD futures fell 9.7% for the week. Henry Hub natural gas moved back above $3 but remains down 31% year over year.

Cheap natural gas isn’t translating into cheaper fertilizer. DTN’s retail survey for the final week of October put anhydrous at $1,007 a ton, up 3% on the month and 19% from a year ago. Urea fell 2% on the month to $669 but remained 12% above last year. Seven of eight major nutrients rose month over month, and all eight were higher year over year. U.S. nitrogen prices follow the global market—including Middle East urea prices, European gas costs, Chinese export policy and Hormuz risk—not Henry Hub alone.