COMMODITIES-Slammed by economic data; biggest drop in 2012

* Brent crude under $90 for first time since 2010

* CRB posts largest drop since mid-December

* Copper hit by slowing factory sector in China

NEW YORK, June 21 (Reuters) - Commodities crumbled for a second day in their biggest sell-off this year on Thursday, with oil, corn and copper tumbling by 3 percent or more after new global economic data darkened the demand outlook for raw materials.

Gold prices threatened to turn negative for the year and Brent crude collapsed below $90 a barrel for the first time since late 2010, extending oil's decline to nearly $40 a barrel since March, as energy markets take the hardest hit from the spiraling euro zone debt crisis and lackluster U.S. economy.

Other commodity markets joined the rout with vigor on Thursday, spooked by a hat trick of data showing China's export order sentiment at its lowest since early 2009; euro zone business activity shrinking for a fifth month; and U.S. manufacturing growing at its slowest rate in 11 months.

Selling accelerated as markets broke below key technical levels, triggering automatic orders, one day after the Federal Reserve extended its program of selling short-term securities and buying longer-dated ones. That disappointed investors who had hoped for a third round of quantitative easing.

The Thomson Reuters-Jefferies CRB index slid more than 2 percent, its biggest one-day drop since mid-December, coming within a hair of its lowest level since September 2010. The drop took two-day losses to more than 3.5 percent, one of the biggest declines since a major rout last September.

U.S. stock markets fell by nearly 2 percent while the U.S. dollar gained 0.8 percent as investors sought safer havens.

"It is a toxic combination of negative factors," said Eugen Weinberg, head of commodities research at Commerzbank.

"Disappointment over the economic situation, the euro zone crisis, high risk aversion and strong downward momentum all mean investors are staying away from oil."

Adding to the gloom was a debt auction where Spain's borrowing costs for five-year paper hit a new euro-era high and business surveys showing the downturn in the euro zone's private sector was becoming entrenched.

OIL SUPPLIES WEIGH

Oil markets are heading toward their worst weekly loss since a dramatic slump in May last year, hammered by data showing decades-high U.S. stockpiles and a lack of restraint by OPEC suppliers, who continue to pump at near record rates.

In London, Brent futures for August delivery fell $3.42 a barrel to $89.27 by 02:21 p.m. (1821 GMT), while U.S. August crude fell $3.25 to settle at $78.20 a barrel, its lowest closing price since last October.

"Supply is outstripping demand and whatever other data you see out there won't change that," said Dominick Chrichella, senior partner at the Energy Management Institute in New York.

"People who are long on oil are just biting the bullet and heading home."

Three-month copper on the London Metal Exchange, the commodity considered most sensitive to growth in China, the world's biggest consumer of the metal, fell 2.75 percent to close at $7,341 a tonne, nearing this year's low. Prices are down 12 percent this quarter and 3 percent for the year.

In China, the factory sector shrank for an eighth straight month in June as export orders sentiment hit its weakest level since early 2009, according to a survey indicating its economic trough may extend well into the third quarter.

"For China it shows (June's) interest rate cut hasn't really filtered through to industry, although we do think this loosening of policy will lead to a recovery in demand in China later in the year," strategist Nikos Kavalis of RBS said.

GOLD SEEN AS A RISK

Gold remained in sync with the riskier asset classes rather than the safe-haven plays, dropping 2.5 percent to effectively wipe out this year's gains in its biggest one-day decline of 2012. Silver dived more than 4 percent.

In addition to the broad-based shunning of risky assets, bullion investors also said a lack of aggressive U.S. Federal Reserve stimulus dampened bullion's inflation-hedge appeal.

"When you see slowdown in China and in the United States and the debt crisis accelerate in Europe, it leads people to believe that we will have significant depreciation, especially when commodities and precious metals prices have been so tied into the monetary policy," said Jeffrey Sica, chief investment officer at SICA Wealth Management LLC, which oversees $1 billion in assets.

In the Chicago corn market, the weight of a global risk-off trade overpowered concerns that dry weather may continue to reduce this year's harvest. July corn fell 4 percent to $5.87-1/2 a bushel, but is still up 1.5 percent this week.

Wheat resisted the weaker trend, dipping just 0.3 percent as short-covering on fears that world production might fall below initial expectations limited the market's slide. (Editing by Bob Burgdorfer)