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By Leslie Reed
WORLD-HERALD BUREAU

LINCOLN -- While Lincoln-area farmer Dave Nielsen was out combining soybeans Monday, he figures $24,000 evaporated from the value of the crop he was harvesting, thanks to Wall Street anxieties and a drop in November-delivery soybean futures prices.

Monday's plunge in the Dow Jones industrial average also dragged down agricultural commodity prices. Futures prices for corn, soybeans and wheat all fell, as did futures prices for cattle and hogs.

"With the kind of loss I took yesterday -- I could have had a lot of fun, or at least spent a lot, in Vegas,'' Nielsen joked.

By Tuesday, wheat and cattle recovered a bit, according to reports from the Chicago Board of Trade and other markets, although they remained lower than Monday's opening prices. Prices for corn, soybeans and hogs continued to drop.

It was the first time since January that corn for December delivery closed below $5 per bushel. Closing prices on December corn peaked at $7.88 a bushel June 26, according to Jeff Stolle, a marketing expert with the Nebraska Cattlemen.

Stolle noted, however, that although prices for cattle and corn now are far below the peaks seen in June, they remain at historically high levels.

Nervous investors probably contributed to Monday's drop in commodity prices, said several agricultural finance experts. Some investors sold their commodity holdings because they needed cash to cover stock market losses. Others may have sold their commodity holdings to reduce their exposure to more loss.

"People are nervous about any risky investments -- they're losing money and they don't want to lose any more,'' said Rob Robertson, vice president of government relations for the Nebraska Farm Bureau Federation.

The drop in commodity prices is a direct hit on farmers, said Rod Gangwish, who raises seed corn and soybeans near Shelton, Neb.

For a farmer who harvests 200 bushels per acre of 1,000 acres of corn, Monday's 30-cent drop in corn futures translates into a $60,000 reduction in the value of his crop, Gangwish said.

That grain farmer probably still will reap a profit on his crop -- but it may not be as large as some analysts predicted earlier this year, Gangwish said.

Meanwhile, livestock farmers already have been enduring a tough financial year, with surplus production at the same time that demand for red meat has been weakening because of the poor economy.

This summer's higher prices for corn and soybeans made matters worse by increasing the cost of animal feed. Monday's drop in grain prices actually provided some welcome relief for livestock growers.

Brad Lubben, an extension agricultural policy specialist for the University of Nebraska-Lincoln, said agriculture thus far has been in a relatively good position while other sectors of the economy have struggled. "The ag finance sector is strong, the farm balance sheet is strong, and ag lenders are strong,'' he said.

Indeed, Robertson noted, after a year of record high prices and worldwide demand outpacing production, grain farmers remain in position for a profitable year.

But with costs of seed, fertilizer and fuel climbing, next year could be a different story, he said.

"The potential is there to lose a lot of money in rural Nebraska next year,'' Robertson said.

Nielsen, who reported he's harvesting 50 bushels per acre of soybeans, said he sold part of his crop early under a forward contract, thus ensuring he will receive some of this summer's higher prices for his crop. He'll hold the remainder, waiting for higher prices.

"It was a loss on the balance sheet yesterday,'' Nielsen said. "Is it a loss or is it a lost opportunity? Think about how much (billionaire investor) Warren Buffett lost on paper yesterday.''