Dry, dry, dry. Almost everywhere you look, other than the Gulf of Mexico, there’s been a lot of dry weather in recent weeks. In Illinois, a dry week with temperatures in the 70s makes for a great week of harvest. But in other parts of the world, dry conditions can lead to planting delays, and the markets just keep moving higher.

“Russia continues to drive the wheat market. They’re the largest exporter and they continue to dictate world prices, whereas the United States continues to be a residual supplier of wheat,” said Aaron Curtis at Mid-Co Commodities. He says that a dry planting season in Russia is much more notable than a dry season in the US, and markets have been responding to Russia’s dry weather concerns. He also said that $6 wheat in Chicago, as well as prices for KC wheat around $5.50, should lead to more U.S. acres planted this fall.

Meanwhile, dry South American weather has helped propel soybean prices even higher, but Curtis says it could also be helpful for corn. “The dry weather in Brazil is not so big of an issue for their soybeans. It’s probably a bigger issue for their second-crop corn,” he said. “You push back this first bean planting, that pushes back harvest, and that pushes back second corn crop planting. And then you get the concern that their corn gets into an April-May time frame when conditions just aren’t as favorable.”

What’s notable is what's happening in the soybean market. While November and January keep moving higher, deferred contracts moved lower Wednesday. Some talk of rain coming to Brazil turned most 2021 contracts negative. As of Wednesday, November soybeans are priced 25 cents per bushel better than July 2021 soybeans, and 85 cents better than next November. AgriVisor’s Karl Setzer says he can’t remember such a wide inverse.

A wild card in here is Friday’s reports from USDA. Protecting the downside during this incredible higher run could be a prudent move. “You’re getting into friction areas, you’re getting into resistance areas technically, and you’re getting into lofty areas that are thin air in the atmosphere of where we are, because of how long the funds are, especially in the soy,” said Mike Zuzolo at Global Commodity Analytics & Consulting.”