Corn futures were sharply lower on Monday, dropping the 30 cent daily trading limit. USDA reports released this morning were bearish. Corn production in 2008 was raised 81 million bushels from previous while USDA cut usage in most categories. Feed use was lowered 50 million bushels, ethanol use was cut 100 million and exports were pushed 50 million bushels lower. This led to the ending stocks forecast rising to 1.790 billion bushels, up nearly 300 million from pre-report trade expectations and 316 million above last month. In addition, sharply lower crude oil prices will add to the pressure. March was 30 cents lower at $3.80 3/4 and May was 30 cents lower at $3.91 1/4.

Soybean futures closed strongly lower on Monday, with several contracts down the 70 cent limit. USDA released several reports this morning and they were bearish. Ending stocks for the current crop year were raised to 225 million bushels from 205 million last month while traders were looking for a decline to around 190 million. A larger 2008 crop and decreased usage led to the increase. In addition, winter wheat seedings were down sharply from last year, which implies the potential for more soybean acreage in 2009. March ended 70 cents lower at $9.66 and May fell 70 cents to $9.75 1/2.

Wheat futures were sharply lower on Monday, with some CBOT contracts down the 60 cent limit. USDA reports this morning were mixed. Larger than expected quarterly stocks led to an increase in USDA ending stocks estimate for this crop year to 655 million bushels from 623 million last month. Traders were looking for ending stocks to decline to 608 million bushels. Also bearish was the 1 million tonne increase in global ending stocks. However, the market failed to find support from the sharply lower winter wheat seedings number. USDA pegged winter wheat acreage at 42.1 million, down 4.1 million from last year and 2.2 million below the average pre-report trade estimate. CBOT March ended 60 cents lower at $5.69 1/2, KCBT March was 56 cents lower at $5.95 and MGE March was 52 cents lower at $6.28 1/4.

Cattle futures ended lower on Monday. Concern about the weak economy continues to be a bearish factor. Strength in the dollar, which is negative for export demand, and the sharp drop in corn prices weighed on futures. Front end losses were limited by further strength in beef prices at midday and futures' discount to last the cash market last week. February ended 20 cents lower at $82.90 and April was 33 cents lower at $86.50.

Lean hog futures closed strongly lower on Monday as USDA data sent corn prices down the daily limit. USDA boosted corn production and slashed usage. With higher than previously expected corn stocks, traders pressured corn prices which, in theory, will boost hog production by the second half of 2009. However, the falling hog futures weren't limited to the deferred contracts. February ended 98 cents lower at $61.48 and April was $1.13 lower at $67.48.