Corn And Oil Ratio

While I cut my teeth in trading in commodities in the early 70’s I do not make commodity comments often.  The grain supply situation that has evolved in the past couple of months brings grain back into the Macro picture in that oil is a big factor in the Macro and ethanol and corn are now part of the energy equation. 

 The corn market has risen to a level in the past week where it is priced on a barrel of oil to a bushel of corn ratio of around 14.5 to 1. In recent history that is relatively cheap for oil or relatively high for corn.  Moving forward from this point the key factor is where is crude oil headed?  We are sticking with our projections for this year that crude will trade in a 65 to 85 range and the market currently is above the 75 mid-point.