Corn futures closed sharply lower on Thursday. Heavy fund selling was triggered by a rally in the dollar index and some forecasts calling for much needed rainfall in Argentina next week. Argentina, the world’s second largest corn exporter, has been dealing with declining crop conditions and hot and dry weather, but forecasts are calling for some rain showers in main corn producing areas next week. March is 15 cents lower at $6.43 1/2 and May was 15 1/4 cents lower at $6.51 1/2.   

Soybean futures traded strongly lower on Thursday. Futures turned lower following and three-day rally with the market being pressured by strength in the dollar index and forecasts calling for improved chances of rain for South American soybean crops next week. The dollar index was higher on continued concern about the European banking system. A higher dollar is bearish for U.S. commodity export demand. January closed 20 1/4 cents lower at $12.01 1/4 and March was 21 cents lower at $12.09. 

Wheat futures ended strongly lower on Thursday. Profit-taking and fund selling pressured the market following the rally in the dollar and concern about the euro zone debt crisis that could further slow demand for U.S. wheat. Sluggish export demand and bearish global supply/demand fundamentals remain underlying bearish factors. CBOT March fell 20 3/4 cents to $6.29 1/4, KCBT March was 28 cents lower at $6.86 and MGE March closed 20 1/2 cents lower at $8.18 1/2.

Cattle futures closed lower on Thursday. The market turned lower as traders wait for the cash market to develop. Strong gains in the dollar index also weighed on the market. While packers are short-bought, cattle numbers are expected to be ample and warm weather in the Plains has helped promote strong feedlot performance. February closed 68 cents lower at $120.95 and April was 60 cents lower at $124.90.

Lean hog futures traded lower on Thursday. Outside markets helped lead to a broad-based commodity sell-off that included the hog market. Strength in the dollar index is a bearish factor for pork exports. Hog supplies remain ample, although supplies are expected to begin tightening seasonally. However, average Iowa slaughter weights last week were up 2.2 pounds from the previous week and 3.2 pounds above year ago. February closed $1.33 lower at $83.85 and April is 63 cents lower at $87.13.