Dryness in the Black Sea region and delays to planting the next winter crop, particular in Russia, have been dominating grain market discussions and social media in recent weeks.
But the lack of spring precipitation in South America is playing havoc with its row crop planting program, and has the potential to have a greater impact on global grain markets in the next six months.
And it is not just a case of being dry.
Temperatures across the central areas of Brazil are reported to have pushed as high as 43°C last week, further depleting soil moisture reserves.
There are hints of rain through the same regions this week, but the forecast models have dialed-back the quantity and expected coverage.
The November forecast is not inspiring, showing below average rainfall is expected across most of Argentina, Uruguay, Paraguay and southern Brazil. This will undoubtedly stress the early sown crops in those regions.
Most of northern and central Brazil is forecast to receive average to slightly above average precipitation across the month of November, which would improve the soil moisture profile and establishment of corn and soybean crops.
The below average precipitation trend is forecast to continue into December for Argentina and Uruguay, but the picture is better for Brazil - with close to average rainfall anticipated across most of the major growing areas there.
Brazilian farmers are proceeding with their corn and soybean planting programs at this stage, despite the extremely dry seedbed, in the hope that the season turns around and substantial beneficial rains are forthcoming in the next couple of weeks.
But the seeding pace will drop if the dry continues into the second half of October.
Brazilian agricultural marketing consultancy AgRural reported last week that about 31 per cent of the summer corn crop was in the ground, which is bang-on the five-year average. But most of it has insufficient moisture to germinate.
It is early days for the soybean planting program, yet it is already behind schedule at 2 per cent completed, compared to the five-year average of 5 per cent. This is not expected to improve in the coming weeks.
Seeding in the state of Parana State is reported to be the slowest in the past five years, with 8 per cent completed as of October 5 - versus 22 per cent at the same time last year.
Brazil's National Food Supply Company (Conab) has pegged the 2020-21 soybean crop at 133.7 million tonnes compared to 124.8 million tonnes last season.
This is from an area of 38.5 million hectares, which is up 4.3 per cent from 36.9 million hectares in 2019.
Conab is calling new crop corn production at 105.2 million tonnes, versus 102.5 million tonnes for the old crop.
The increased soybean area is a direct result of record high domestic prices.
This has encouraged the clearing of more land and planting of soybeans in preference to alternative cropping options.
The depreciation of the Brazilian Real against the US Dollar, higher futures prices and insatiable Chinese demand mean that the Brazilian farmer is getting double the soybean price compared to a year ago.
This is an enormous incentive to plant soybeans, and farmers don't care if they are planted late.
So, even if the dry weather and the planting delays continue, Brazilian farmers will sow as many hectares to soybeans as possible and as late as possible.
The record prices have also been encouraging Brazilian farmers to pull on their selling shoes.
They are reported to have already sold almost 66 million tonnes - or more than 50 per cent of their forecast 2020-21 production - even though most of it is yet to be planted.
This is a record for the proportion of the crop sold at this point in the production cycle and is almost double the historical average of 26.7 per cent for early October.
The drought situation in Argentina is even worse. But, such as in Brazil, the farmers are optimistic, and planting is proceeding at present in the hope that the usual spring and rains arrive.
The Buenos Aires Grain Exchange (BAGE) has dramatically reduced its 2020-21 soybean crop forecast to 46.5 million tonnes, against the USDA estimate of 54 million tonnes.
BAGE has also revised its corn crop estimate down 8.7 per cent year-on-year to 47 million tonnes.
The concern at this stage is not so much that the South American summer crops won't get planted; it is more about the impact of the delayed crop on global supply - and in particular soybeans.
With the delay in bean planting in Brazil comes a delay to harvest, so it is almost assured that there will be a global shortage of soybeans in February next year when the US export program is winding down.
Brazil's biggest farming state is Mato Grosso, and by the end of January this year it had already harvested 9 million tonnes of soybeans - or 25 per cent of the state's total crop.
Given the current scenario, it is very tough to see any more than one third of that being in the bin by the end of January next year.
That will substantially cut stocks available for export from Brazil in February.
The domestic soybean consumer in the US should be praying pretty hard that the weather pattern changes very soon in Brazil and Argentina and the spring rains arrive.
Chinese soybean demand is currently more than 2 million tonnes per week.
Every day the planting program is delayed means another five or six cargoes of Chinese imports that will have to come from the US in February, adding to the expected tightness in the US soybean balance sheet.
The soybean futures market has already rallied and many analysts suspect prices could go even higher if the lack of rain and planting delays persist.
US futures have now increased more than 7 per cent since the most recent low on September 29, and much of this is on the back of the South American issues.
And the rise during the past two months is now almost 23 per cent - or about $100 per tonne.
The Chinese have come back from their 'Golden Week' holiday in the mood for shopping and this has coincided with a sharp drop in ocean freight.
Soybean sales to China now total 17.5 million tonnes this season, compared to 3.9 million tonnes at the same time in 2019.
And sales to unknown (read China) are now 10.7 million tonnes, versus 4 million tonnes a year ago.
Chinese buyers are aware of the weather issues that Russia, Brazil and Argentina are currently experiencing and what this could do to prices in the next six months.
Expect the Beijing buying binge to continue for some time yet.
The story Grains industry monitors global conditions as harvest gets underway down under first appeared on Farm Online.