It’s a difficult time for commodities bulls. Crude oil is off more than 20% from its July peak. Gold is going for about $830 an ounce, way off its Spring highs. And the Reuters/Jefferies CRB Index is down 19% from its June high.

Energy expert Byron King says investors shouldn’t panic over the drop in prices. For a start, August is a notoriously poor month for commodities. It tends to be a month of net selling.

Despite some demand issues caused by the global slowdown, Byron says commodities are in a short-term correction. And that means plenty of great bargains on offer…

The Reuters/Jefferies CRB Index shows commodities jumped 29% in the first six months of this year – the best first half for more than 30 years.

But there is much talk now of a “commodities bear market” and the popping of the so-called “commodities bubble” as prices pull back from their highs.

Jim Rogers, however, remains a commodities bull. “This bull market is not magic,” says Jim, writing in Whiskey and Gunpowder. “It’s not some crazy ‘cycle theory’ I have. It does not fall out of the sky. It’s supply and demand. It’s simple stuff.”

Commodities have been tumbling for more than one month. Energy, metals and agricultural products have dropped by double-digit percentages. This means there are potential technical rebounds on their way and opportunities to take profit for more or less short-term corrections, says Gabriel Andre in The Daily Reckoning Australia. Corn may be one of those opportunities.

The bear market in commodities may last for six to nine months before prices rebound in 2Q of next year, according to a report by Bloomberg.

The report is just the latest in a series of Big Media stories on the death of the six-year commodities bull run, aka “the commodities bubble.”

Eric Roseman in The Sovereign Society says the mainstream press have got it wrong on commodities. What we are seeing is a correction in prices, not a trend reversal. And it’s creating the best entry point for new investors in more than three years. 

There has been a lot of talk lately about food stocks. Spam-maker Hormel (NYSE:HRL) and egg producer Cal-Maine (CALM) are two downturn picks we’ve published in recent days. Even in a recession, the logic goes, people still have to eat.

Today, The Sovereign Society’s Investment Director, Eric Roseman, says France’s Groupe Danone (EPA:BN) is another excellent way to play the downturn.

The world’s largest fresh dairy company posted strong earnings last week. And it is set to benefit from a correction in commodity prices.

Corn and soybeans fell nearly 3 percent yesterday, according to Reuters, “as risk premiums built into the market in case of crop failure peeled away as favorable weather in the grain belt boosted production prospects.”

Soybeans have been extremely volatile to say the least, says commodities expert Kevin Kerr in Whiskey and Gunpowder.

The problem, says Kevin, is that all the rosy crop reports won’t come to fruition once harvest time rolls around. He says they’re just a lot of wishful thinking…

Heavy rains and floods in the Midwest will cut the U.S. soybean harvest by 3 percent and push the farm-gate price to a record $12.75 a bushel, $2.60 more than the 2007 crop, reports Reuters.

This is good news for Brazil.

Brazil is the world’s largest exporter of soybeans. It is also fast becoming the world’s agriculture superpower, says Tom Dyson in DailyWealth. But Brazil’s soy business is heavily reliant on fertilizer – and this opens up a huge profit play…

High grain prices aren’t just hurting hog farmers, they’re damaging ethanol producers too.

If prices causes ethanol plants in the Midwest to close, it could flood the market with unused corn, says Tom Dyson. Expect to see a big fall in corn prices in the near future…

Even without ethanol plants closing corn prices are already starting to fall…

Corn prices may have sold off in recent days, but they remain more than double the value of a year ago. This is having a dramatic impact in related industries. Corn is the staple diet of most farmed animals. And as their food bills climb, farmers are feeling the strain. Tom Dyson recently visited Iowa and says farmers there are throwing piglets in the trash — hogs there are no longer worth the feed costs…

Corn prices could hit $10 a bushel this year, reports MarketWatch.

According to the report: “A large loss of acreage could slash U.S. corn production and push next season’s year-end stocks to the lowest level since just after World War II, some analysts said.” If bad weather continues in July and August, corn prices could rise to $10 a bushel, said Shawn Hackett, president of agriculture futures brokerage Hackett Financial Advisors.”

On Thursday, Jennifer Yousfi told Money Morning readers three ways to profit from record meat and dairy prices — both of which are closely connected to the price of corn.