Sugar prices plummeted nearly 5 percent Friday amid expectations that global supplies will be plentiful for the first time in about two years.
Most energy, metals and grains prices fell as the dollar gained strength against other currencies. Commodities are priced in dollars and become less appealing to foreign investors when the dollar is stronger.
Sugar for July delivery fell 0.73 cent to settle at 14.19 cents a pound. The price has fallen 51 percent since hitting a 29-year high in early February amid concerns that supplies would be tight.
Now, growers in Brazil are harvesting a healthy crop and it appears the monsoon season will benefit growers in India, which has had two consecutive years of below-normal rainfall, said Spencer Patton, founder and chief investment officer of Steel Vine Investments LLC, a hedge fund that trades in commodities.
"Sugar is just being produced in such quantities that it's totally alleviating the concerns that we've had over the past couple of years of severe supply shortages," he said. "There's more people than ever planting sugar."
The dollar grew stronger as the euro weakened after Spain's credit rating was downgraded for the second time in a month. There have been concerns among investors and traders that Europe's financial crisis could affect the global economic recovery.
The ICE US dollar index, which measures the dollar against the euro and five other currencies, rose about one-half percent.
In July contracts, copper fell 5.4 cents to settle at $3.1045 a pound; platinum lost $3.50 to $1,549.40 an ounce and silver fell 4.6 cents to $18.422 an ounce. June palladium settled down 40 cents at $461.85 an ounce.
Gold for August delivery added 60 cents to settle at $1,1215 an ounce.
Energy prices were mixed. Benchmark crude for July delivery fell 58 cents to $73.97 a barrel on the New York Mercantile Exchange,
In other Nymex contracts for June, gasoline fell 1.91 cents to settle at $2.0198 a gallon and heating oil lost 1.92 cents to $1.9802 a gallon.
The contracts for gasoline and heating oil both expire Friday so much of the trading has moved to July contracts. July gasoline lost 0.88 cent to $2.0266 a gallon and July heating oil lost 0.52 cent to $2.0045 a gallon.
July natural gas rose 4.7 cents to $4.341 per 1,000 cubic feet.
In grains contracts for July delivery, wheat fell 10 cents to settle at $4.5775 a bushel; corn fell 14.25 cents to $3.59 a bushel and soybeans fell 14 cents to close at $9.3775 a bushel.
Copyright 2010 The Associated Press.