"People (are) less enthusiastic with the markets seeing the dollar getting stronger again. What we saw (previously) was pretty much a correction to the upside and now we should resume the downtrend," said Rodrigo Costa, vice-president Institutional Sales for Newedge USA in New York .

    Crude oil slipped to a 19-month low to around $60 a barrel on Thursday on demand worries amid the weak global economic outlook.

    "Everything is sinking. Energy collapsed yesterday, today it's collapsing even further. The dollar is getting stronger. Every time the dollar gets stronger we see commodities

collapsing," Costa said.

    The greenback climbed more than 1 percent, pressuring dollar-traded commodities. This contributed to the broad-based commodity weakness, causing funds to liquidate some long positions in the coffee and sugar markets, triggering automatic

sell orders, traders said.

    ICE December arabicas finished down 5.40 cents, or 4.6 percent, at $1.11 per lb. London January robustas closed down $72, or 4 percent, at $1,728 per tonne.

    Sugar futures were also hit hard later in the session.     ICE March raw sugar tumbled 0.77 cent, or 6.1 percent, to finish at 11.87 cents a lb, while London December  white sugar futures closed down $18.4, or 5.3 percent, at $327 per tonne.

    UK broker Sucden referred to a lack of new fund money to push sugar values higher.

    "Hence, for the rest of the week downside risks remain," Sucden said in a daily market report.

    However, dealers said tightening global supplies of the sweetener could push prices higher into 2009.

    Delays in harvests in Asia and lower freight rates could tempt top producer Brazil to sell some sugar cargoes, even though the liquidity crunch has forced some consumers to hold back purchases, dealers said on Thursday.

    Ukrainian sugar refineries have produced 878,900 tonnes of white sugar from beet as of Nov. 5, 30 percent less than at the same date in 2007, local agriculture news agencies said on Thursday.

    The Reuters-Jefferies CRB index , a global benchmark for commodities, fell nearly three percent.

    Cocoa futures also ended the day in negative territory but held up better than the other soft commodities with more modest losses. The soft pound against the dollar pressured the U.S. market while providing some support to London , dealers said.

    London cocoa was firm earlier in the session but later fell when outside markets slid deeper.

    ICE benchmark December closed down $60, or 3 percent, at $1,913 per tonne, while London March cocoa finished 7 pounds lower at 1,273 pounds per tonne.