COMMODITIES-Markets dive on US budget cuts,dollar;oil down on yr

* CRB index hits 7-1/2 month bottom

* Brent oil down more than half pct on the year

* Copper trades below $7,652/ton, a 3-month low

* Cocoa, sugar down nearly 3 pct each; gold joins slide

NEW YORK, March 1 (Reuters) - Commodities tumbled on Friday, with oil entering negative territory for the year and copper hitting a three-month low, after U.S. budget cuts and a surging dollar triggered worries about raw materials demand. Cocoa and sugar were among other commodities that fell sharply, losing nearly 3 percent each, after data showing weakness in European manufacturing and cooling growth in Asia. The Thomson Reuters-Jefferies CRB index, the commodities bellwether, fell nearly 1 percent, to a 7-1/2 month low. Orange juice tumbled the most among the CRB's 19 components, losing 5 percent. The sell-off was sparked by market jitters related to the political gridlock over the U.S. budget, where rival Democrats and Republicans set off $85 billion in automatic spending cuts known as "sequestration". The International Monetary Fund has warned that the cuts could knock at least 0.5 percentage points off U.S. economic growth this year and weigh on the rest of the global economy. "Despite some green shoots in the United States, the growth forecast remains mediocre, unemployment stubbornly high and economic data inconsistent," oil brokerage PVM said in a note to clients. The strong dollar was another factor discouraging those holding other currencies like the euro and yen from buying dollar-denominated commodities. The euro fell to a 2013 low while the dollar itself hit a 6-month high against a basket of major currencies.

GOLD JOINS OIL, METALS SLIDE In oil, benchmark Brent crude traded in London closed down 98 cents, or almost 1 percent, at $110.40 a barrel. It fell to a six-week low below $110 during the session. Brent has dropped more than $9 a barrel over the last three weeks since it hit a nine-month high of $119.20. It is now down 0.6 percent for the year. U.S. crude settled down 1.5 percent at $90.68 per barrel, after hitting a low of $90.44 earlier in the session, its weakest since December. Copper fell to its lowest in more than three months after data from top metals importer China showed slowing factory growth. Three-month copper traded in London touched its lowest since November last year at $7,652 a tonne, and ended down at $7,700, versus a closing bid of $7,815 on Thursday. Prices fell more than 4 percent in February. Tin, nickel, zinc, lead and aluminium prices all hit multi-month lows. Gold also fell, posting its third straight weekly decline and debunking the precious metal's reputation as a safe haven versus other commodities and assets. Spot gold XAU= was down 0.3 percent to $1,575.26 an ounce by 3:00 p.m. ET (2000 GMT). U.S. gold futures GCJ3 for April delivery settled down $5.80 at $1,572.30.

Prices at 3:14 p.m. EST (2014 GMT)

LAST/ NET PCT YTD CLOSE CHG CHG CHG US crude 90.92 -1.14 -1.2% -1.0% Brent crude 110.54 -0.84 -0.8% -0.5% Natural gas 3.456 -0.030 -0.9% 3.1%US gold 1572.30 -5.80 -0.4% -6.2% Gold 1575.36 -4.16 -0.3% -5.9% US Copper 348.15 -4.60 -1.3% -4.7% LME Copper 7703.00 -112.00 -1.4% -2.9% Dollar 82.305 0.356 0.4% 7.2%US corn 724.00 4.50 0.6% 3.7% US soybeans 1464.50 -9.75 -0.7% 3.2% US wheat 713.25 5.50 0.8% -8.3%US Coffee 143.35 0.15 0.1% -0.3% US Cocoa 2082.00 -53.00 -2.5% -6.9% US Sugar 17.91 -0.48 -2.6% -8.2%US silver 28.490 0.058 0.2% -5.7% US platinum 1573.50 -10.00 -0.6% 2.3% US palladium 720.40 -14.15 -1.9% 2.4%