Grain and soybean futures prices fell sharply Monday on the Chicago Board of Trade as the U.S. dollar continued its advance.
The surging dollar also took its toll on gold, which fell more than $12 with the February contacty at $282 an ounce on the Commodity Exchange in New York.
"The Deutsche mark--down; the Swiss franc, down sharply; the British pound, down. Those are the biggest factors in the market," said Richard Loewy, senior grain and oil seed analyst with Prudential-Bache Securities in New York.
Loewy explained that a strong dollar dampens the sale of American-grown produce in countries whose currencies are losing ground against the U.S. currency.
Especially vulnerable are the soybeans that square off against more competitively priced South American soybeans, Loewy said. The selloff in the soybean pits that saw life-of-contract lows registered across the board spread to the corn pits.
Life-of-contract lows were reached in all corn contracts, Loewy said. Several contract lows were touched in the wheat pits as traders reacted negatively to word that the Soviet Union, China and Brazil had canceled tender offers in recent days, Loewy said.