Linn Group Morning Soybean Comment

CHICAGO - Sep 11/06 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybean Update: Soybeans ended down 2 cents in the November contract on
Fridays session ending the week lower for the 9th. consecutive lower weekly
close. November soybeans traded an additional 2 ¾ cents lower overnight.
Traders say they expect further weakness today due to an overall slide in
commodity prices overnight with gold trading below $600 per oz for the first
time since June. Tuesday the USDA releases its September crop production
report and the consensus of analysts expectations is for the USDA to
increase its 2006 U.S. soybean crop from 2.928 bil bu to a range of 3.0 to
3.2 bil. Bu. and an increase in average bpa of 40.6 to 43.2 bpa from 39.6
bpa. The Linn Group a private analyst group in Chicago released its crop
production report on Friday showing an overall yield of 3.2 bil bu and an
average bpa of 43.65 bpa. Grain analysts are debating whether the USDA will
change Its corn production but are unanimous in their opinion that they will
raise soybean production. Soybean prices are at lows not seen in 1 ½ years
and aggressive harvest is just around the corner and prices are expected to
remain under pressure through harvest. The Commitment of traders report with
options as of September 5th shows funds short 45,224 soybeans down 23, Meal
short 39,076 down 4,477 and Oil long 18,086 down 3,954. Funds on Friday
bought 1,500 soybeans, 2,000 Oil and even in meal. Chinese Soybean and oil
futures closed higher, Meal lower.

eCBOT Overnight
Contract            Last                  Net Change       High      Low
ZSX6                 545^2                -2^6                  549^4
544^6
ZSF7                558^2                -3^4                  569^2
558^0
ZSH7                                        N/A
ZSK7                580^6                -3^2                  583^6
580^6
ZMU6                157.5                -0.3                   157.5
157.4
ZMV6                158.8                0.1                   159.2
158.3
ZMZ6                160.7                -0.1                   161.7
160.7
ZLU6                                         N/A
ZLV6                 24.76                0.04                  24.76
24.70
ZLZ6                 24.86           -0.25                      25.19
24.76

Early Opening Calls: lower 2 to 3 lower

Top News
-- South Korea bought 100,000 mt. Indian Soymeal  for Dec/Feb.

-- Fund trade fairly quiet Friday.  Funds  bought  1,000 Corn, 1,500
Soybeans, 2,000 Oil.  Sold 800 Wheat.  Even Meal.

-- Soybean spreads:  PB 500 SF/SX, FCS 400 SX/SX7, Tenco 300 SU/SX, Bunge
300 SU/SH.

Cash Markets

-- CIF Soybeans steady up 1   Sept. +54 to +58, LH Sept. +57 to +59, Oct.
+59 to +62, Nov. +67 to +73, Dec. +56 to +62, Jan. +60 to +64.

-- Processors:    Decatur  -15   Danville -10   Bloomington  -30   Gibson
City  -20

-- Board Crush Margins: Sept. 79.66  off  2.34; Oct.  73.06  up  .62; Jan.
75.92  up  .31

To discuss this report further or for specific trade ideas please contact me
directly


Nathan T. Smith III
Linn Group
nsmith@linngroup.com
toll free: (877) 787-6278
local: (312) 896-2090
fax: (312) 896-2050
www.linngroup.com/

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