MarketsFarm — The weather is just one of the factors guiding futures values at the Chicago Board of Trade (CBOT), according to Terry Reilly, grains analyst for Futures International in Chicago.

As prices have fluctuated with hot and dry weather interrupted by rain, Reilly noted there’s more to the ebbs and flows than the latest forecast.

To the analyst, the primary reason for CBOT soyoil tumbling is that it’s oversold.

“The beanoil has been very overpriced. It was due for a correction. Traders may have run up the market a little too high. Basically we’re seeing a general correction in soyoil futures,” he said.

The growing likelihood of U.S. President Joe Biden changing course on that country’s Renewable Fuel Standard has played something of a role in the drop in soyoil, he added. Although Biden promised to curtail the granting of waivers from the standard, the president is reportedly leaning toward issuing more waivers.

Meanwhile, corn remained beholden to the weather, as dry conditions have been adversely affecting the western portion of the U.S. Corn Belt, creating soil moisture deficits, Reilly said. That area, he noted, included southern Minnesota and northwestern Iowa.

Dryness as well has played an influence on U.S. wheat prices, be it for Minneapolis, Kansas City or Chicago wheats. However, Reilly noted, the abrupt cancellation of a wheat tender by Egypt, the world’s top importer of wheat, also has led to an uptick in values.

The analyst believes the weather will hold sway over the grain markets for the rest of June, until the U.S. Department of Agriculture (USDA) releases its quarterly grains stocks and acreage reports.

As the June 30 release date approaches, there is likely to be some positioning at CBOT.

— Glen Hallick reports for MarketsFarm from Winnipeg.