Oil, grain prices now on same track: ag economist

Prices for grains and oilseeds have been steadily rising over the past year — and western Canadian farmers can thank high oil prices and the biofuel industry, a Saskatoon economist says.

Richard Gray, an agricultural economist at the University of Saskatchewan, says things have changed dramatically since a year ago when farmers were looking at grain prices that didn’t pay their bills.
Gray says it’s a major shift in thinking that for the first time in history, prices for grains and oilseeds — wheat, barley, canola, flax — are tied to the price of oil.

“You didn’t need to look at the price of oil when you were trying to figure out what the prices of wheat was or the price of canola,” he said. “Now you have to look at it very carefully. And when that oil price changes you have to think of what implications that is going to have for the agricultural sector. “

CBC