Corn and wheat prices plummeted Friday after a government report showed U.S. supplies were larger than anticipated.
Corn ended 6.3 percent lower and wheat dropped 6.9 percent. Most other commodities prices also fell, ending a rocky third quarter. One of the few bright spots was gold, which ended slightly higher.
Corn stockpiles totaled 1.13 billion bushels and wheat stockpiles totaled 2.15 billion bushels as of Sept. 1, the U.S. Agriculture Department reported. Both figures were higher than traders had estimated. Soybeans totaled 215 million bushels, less than expected.
Corn prices have been higher compared with the same time a year ago because of expectations that the grain would be in short supply in the U.S. and abroad. Higher corn prices factor into what consumers pay for many kinds of products including cereal, beverages and ethanol. High corn prices can also affect the cost of meat because corn often is used to feed livestock.
The revised estimates could mean some of those higher consumer prices will start to ease in the next six months, analysts said.
"If there's more profit margin at the packer level and at the wholesaler level, then some of that should be passed onto retailers" and lead to lower grocery prices, Global Commodity Analytics & Consulting LLC President Mike Zuzolo said.
December corn fell 40 cents to end at $5.925 per bushel. The price is down about 5.8 percent for 2011, but it's still 19 percent higher than it was at the same time last year.
December wheat fell 45 cents to end at $6.0925 per bushel and November soybeans fell 51 cents to $11.79 per bushel.
Broader economic concerns weighed on most commodities, including grains. Commodities also were hurt by an increase in the value of the dollar against other currencies. Commodities are generally priced in dollars, so when the dollar rises in value that makes it more expensive to buy commodities contracts using currencies other than the dollar.
The Commerce Department said Americans' incomes dropped 0.1 percent last month, the first decline in nearly two years. Consumer spending rose 0.2 percent, with much of the increase used to pay higher food and fuel prices.
Meanwhile, inflation jumped to 3 percent in September in the 17 countries that use the euro, according to the European Union's statistics agency.
In China, a monthly survey released by HSBC showed the country's manufacturing production was stagnant in September because of sluggish demand. Chinese industrial production has slowed following the government's efforts to curb economic growth and control inflation, which is currently hovering just above 6 percent.
The manufacturing data hurt copper because China imports large quantities of the industrial metal. Copper for December delivery fell 9.4 cents, or 2.9 percent, to end at $3.152 a pound.
In other trading, December silver fell 43.9 cents to end at $30.083 per ounce. January platinum fell $9.30 to $1,523.60 an ounce and December palladium dropped $9.05 to $614.50 an ounce. December gold rose $5 to finish at $1,622.30 an ounce.
Benchmark oil fell $2.94, or 3.6 percent, to finish at $79.20 a barrel on the New York Mercantile Exchange.
Heating oil dropped 4.73 cents to end at $2.7793 per gallon, gasoline futures fell 2.05 cents to $2.5381 per gallon and natural gas fell 8.1 cents to $3.666 per 1,000 cubic feet.