Nightly Recap of the Metals, Energy, Grains, Meats, and Softs Markets

Energy

Crude oil had its largest daily gain in history, surging $16.37, or 15.7-percent, to close at $120.92 a barrel on the October contract. It was a historic day eclipsing the previous record gain of $10.75 set on June 6th of this year. The front month October contract was set to expire today, and a short squeeze sent prices skyward.

About 76.6-percent of oil output and 65.5-percent of the natural gas production in the Gulf of Mexico is still shut in as of Monday, according to the U.S. Minerals Management Service.

Trading was halted for five minutes after the October crude contract reached the daily price limit of $10 per barrel. Under NYMEX rules, the price change limit is increased by another $10.

November RBOB gasoline settled 10.4 cents higher at $2.7038 a gallon, October heating oil finished 14.5 cents higher at $3.043 a gallon, and October natural gas settled 12.7 cents higher at $7.658 per million British thermal units.

Grains

Soybeans soared over 5-percent today, with the November contract settling 61 1/2 cents higher at $12.05 a bushel. The shorts were running for cover as inflation fears sparked a broad based rally in commodities today. December soy-meal settled $12.50 higher at $328.00 per short ton, and December soy-oil closed 263 points higher at 50.03 cents per pound.

Corn finished the day 3-percent higher, with the December contract gaining 16 1/4 cents at $5.58 1/2 per bushel. Favorable weather in the Midwest, with no signs of any frost on the way, combined with poor export sales were not enough bearish news to keep corn from settling higher on spill-over strength from surging oil, and the falling dollar.

Wheat closed 2.8-percent higher today, with the December contract settling 19 3/4 cents higher at $7.37 3/4 per bushel. Modest concerns over Brazils crop is seen as supportive, even in the face of projections for a record crop.

The forecast for global wheat production in 2008-09 was raised to 676.3 million tons, climbing 5.5 million since the August estimate and up 65.4 million from 2007-08, the U.S. Department of Agriculture said last week.

Dryness in the Southern Hemisphere remains a concern for the market, with production in Argentina estimated to fall by as much as 25-percent from the 16 million metric tons grown last season, according to the Buenos Aires Cereals Exchange.

November rice settled 50 cents higher at $19.71 per hundredweight, and December oats gained 9 1/4 cents at $3.41 a bushel.

Metals

Gold closed 5.1-percent higher today, with the December contract settling $44.30 higher at $909 an ounce. Investors seeking safety from the financial crisis, and speculation that the global liquidity machine will increase inflation was noted for the bullish action in gold.

The U.S. dollar slid 2-percent lower against the euro to a fresh three-week low of $1.4775. Speculation that the Bailout by the Feb will further weaken the U.S. dollar was noted for much of the bullish action in metals today.

December copper settled 7.85 cents higher at $3.2550 a pound, December silver rose 97.5 cents to $13.45 an ounce, October platinum rose $88.80 to settle at $1235.80 an ounce, while December palladium gained $18.80 to finish the session at $255.75 an ounce.

Softs

Cotton closed nearly 3-percent higher with the December contract gaining 187 points to settle at 64.39 cents a pound. Cotton gapped higher on the open and continued to rally on U.S. dollar weakness, and the rally in grains.

Coffee finished the session 3-percent higher, with the December contract settling 350 points higher at $1.3660 a pound. After falling 5-percent last week coffee closed higher on short covering and spill-over strength from outside markets.

Orange juice gained 3.4-percent today, with the November contract gaining 305 points to settle at 92.95 cents a pound, October sugar settled 41 points higher at 12.06 cents a pound, and December cocoa finished $36 higher at $2,726 a metric ton.

Meats

Cattle settled higher today, with October feeder cattle finishing 120 points higher at 107.05 cents a pound. Last Fridays cattle report was seen as bullish to the market. October live cattle settled 90 points higher at 102.45 cents a pound.

The U.S. Department of Agriculture's midday beef wire for Monday showed choice cuts fell $0.52 per hundredweight lower, while select items fell by $1.19 per hundredweight.

Hogs closed higher today, with October lean hogs gaining 45 points to settle at 68.65 cents a pound, and February pork bellies settled 282 points higher at 93.72 cents a pound.