Thunderstorms in parts of the grain belt and a report that the Biden administration may cut the required volume obligations (RVO) under the Renewable Fuel Standard (RFS) sent soybean oil and corn prices tumbling on Friday and the markets have yet to hit a bottom. The move lower in the vegetable oil markets, including palm, have either arrested price movements or sent prices lower in most animal fat and co-products markets this week.

The July soybean oil (SBO) contract is off 23 percent compared to the daily high of one week prior. A forecast for storms across the Great Plains and Midwestern states has contributed to further selling in a market that had run up partially on drought concerns. Corn in particular is entering a critical phase of development and rains will be needed to avoid large yield and/or crop losses. Despite the rain last week much of Iowa, Minnesota and Wisconsin remain in moderate to severe drought. Similar conditions are present in South Dakota and eastern…