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Energy

Crude oil closed modestly lower today, with the October contract settling 36 cents lower at $109.35 a barrel. News that the U.S. Energy Department will release oil from its emergency reserves due to storm related disruptions sent oil lower on the session.

On Wednesday, about 96-percent of oil production in the Gulf of Mexico, and about 92-percent of natural gas output remained shutdown, according to the U.S. Minerals Management Service. The Gulf of Mexico accounts for 25-percent of U.S. oil production and 40-percent of refining capacity.

Royal Dutch Shell, and other energy companies were still assessing offshore energy installations Wednesday, with no reports of major damage following Gustav. "Our goal is to restart all shut in systems safely and as quickly as possible," Shell said in a statement.

The EIA will release its weekly data on natural-gas supplies at 10:30 a.m. EDT Thursday, Analysts expect the EIA to report an increase of 90 to 100 billion cubic feet of natural-gas supplies for the week ended Aug. 29. The EIA will release its report on petroleum supplies at 11 a.m. with analyst expecting a decline of approximately 2 million barrels.

October natural gas settled nearly unchanged at $7.264 per million British thermal units, October RBOB gasoline settled 3.3 cents higher at $2.7668 a gallon, and October heating oil settled 0.5 cent higher at $3.0788 a gallon.

Metals

Gold fell to a 2-week low today, with the December contract settling $2.30 lower at $808.20 an ounce. Strength in the U.S. dollar, and falling energy prices reduces the appeal of precious metals as a hedge against inflation. The euro fell nearly 1-percent versus the dollar after reports showed the economy in the 15 nations is slowing.

Hedge funds and other large speculators reduced their net long gold futures position by 6-percent in the week ended Aug. 26, as shown by U.S. Commodity Futures Trading Commission data. Speculative long positions still outnumbered short positions by 105,279 contracts.

Palladium closed 1.6-pecent lower today, with the December contract settling $4.65 lower at $288.40 an ounce. Collapsing auto sales have helped contribute to a decline of over 50-percent in the price of palladium, which is used in catalytic converters, over the past 6-months.

Ford, the second-largest U.S. automaker, reported that sales in the U.S. fell 27-percent in August, marking the 21st decline in the past 22 months. Car and light-truck sales in the U.S. are expected to reach the lowest level since 1993.

December silver settled 19.8 cents lower at $12.947 an ounce, and October settled $11.30 lower at $1,392.20 an ounce, December copper settled 3.90 cents higher at $3.3120 a pound.

Grains

Soybeans closed 3.4-percent lower today, with the November contract settling 47 cents lower at $12.51 1/2 a bushel. Rain in the Midwest totaling 1 inch in some areas over the past day, with expectations for another 2 to 3 inches on the way, is expected to boost crop conditions and increase yields.

About 57-percent of the soybean crop was rated good to excellent as of Aug. 31, down from 61-percent a week earlier and 56-percent a year earlier. About 61-percent of the corn was rated good or excellent, down from 64-percent a week earlier and 59-percent a year earlier, the U.S. Department of Agriculture said yesterday.

Corn closed 1.2-percent lower today, with the December contract settling 7 cents lower at $5.62 1/4 a bushel. Improving soil moisture, falling energy prices and the climbing dollar was noted for corn’s decline.

September wheat closed 8 cents higher at $7.52 1/4 a bushel, September rice settled 29 cents higher at $1844 a short ton, December soy-meal settled $13.40 lower at $342.00 per short ton, and December soy-oil settled 159 points lower at 51.24 cents per pound.

Softs

Orange juice closed unchanged today, with the November contract settling at $1.0620 a pound. Orange juice bounced higher on the open after falling 5.3-percent yesterday, before selling pressure in sympathy of further commodity weakness left the market unchanged on the session.

Cocoa closed .5-percent higher today, with the December contract settling $14 higher at $2,678 a metric ton. Speculation that cold wet conditions in the Ivory Coast could promote the spreading of black pod disease and strike the largest cocoa producer was noted for slight gain in cocoa today.

Coffee closed slightly lower today, with the December contract settling 50 points lower at $1.4395 a pound. With a lack of fresh fundamental news coffee continued in the path of least resistance, which is lower.

October sugar closed down 19 points at 12.52 cents a pound, December cotton settled 49 points lower at 69.69 cents a pound.

Meats

Hog futures were falling today, with December lean hogs settling 120 points lower at 68.75 cents a pound. Speculation of slowing demand to Mexico, which is the third largest importer of U.S. pork, and expectations for a huge slaughter on Saturday was noted for the decline in hogs. February pork bellies settled 245 points lower at 90.30 cents a pound.

Analyst expectations for Saturday's hog slaughter is above 300,000 head with the week's total nearing 2.050 million, this would send the slaughter about 6.2-percent above a year ago. The larger slaughter is seen as bearish for the market.

Feeder cattle closed 1-percent lower today, with the September contract settling 122 points lower at 111.55 cents a pound. General commodity liquidation and speculation for slowing demand was noted for the decline. October live cattle shed 60 points to settle at 103.15 cents a pound.