Linn Group Morning Soybean Comment

CHICAGO - Oct 13/06 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybean Update: Thursday was rally day for the Soybean complex. The USDA
released a crop production and stocks number well below analysts
expectations and early calls were 7 to 10 better on the open. After trading
25 higher we closed 17 ½ higher. Soybean Meal was the product leader ending
$6.10 higher. Traders say much of  the strength in the soybean complex was
short covering in all products. Funds were active buying 8,000 soybeans,
6,300 meal and 4,000 Oil. Traders say Farmer selling was moderate saying
most were holding out for higher prices. Although the USDA numbers were
lower than analysts expectations traders caution that we are in harvest and
expectations are for a large crop and to expect pullbacks. Overnight
Malaysian Palm oil futures closed higher.

Opening call: ½ to 1 cent higher.


eCBOT Overnight
Contract            Last      Net Change       High      Low
ZSX6                 581^2    1^4                   582^6    578^2
ZSF7                595^2    0^6                   596^6    592^2
ZSH7                605^0    0^6                   606^4    603^0
ZSK7                613^2    2^4                   613^2    610^4
ZSN7                621^0    1^2                   621^6    618^6
ZMZ6                173.9    0.6                    174.5    172.7
ZMF7                175.3    0.8                    175.6    174.5
ZLZ6                 25.00    0.11                  25.00    24.84
ZLF7                 25.38    0.06                  25.38    25.26



Top News
**USDA Soybeans 06/07 Export Sales Net: 1.086 mln mt
**USDA Soybean Meal 06/07 Export Sales Net: 101,400 mt
**USDA Soybean Oil 06/07 Export Sales Net: 2,400 mt

-- Exports: Taiwan tendering for 60,000 mt.  US or Brazil Soybeans for
Nov/Dec.

-- Soybean spreads: Fimat 2,600 SF/SX, JPM 2,200 SF/SX, Tenco 600 SX/SN,
Term 400 SN/SX7

-- Argentine based soybean analyst suggested 06/07 output could rise 9% from
year ago crop on back of favorable recent rains.
-- Canada Ag ministry presses for reduced import tariffs by China on
Canadian canola imports.
-- Chinese FX reserves have grown to $987.9 Billion, a rise of $46.8 bln in
3Q.  Record trade surplus has had the greatest impact on the FX reserves.


Cash Markets
-- CIF Soybeans off  1-3 . Oct. +54 to +??, LH Oct. +56 to +58, Nov. +65 to
+69, Dec. +58 to +63, Jan. +62 to +73.
-- Processors:    Decatur  -15    Danville -18   Bloomington  -20   Gibson
City  -20
-- Board Crush Margins:     Oct.  69.47 up .87   Dec. 75.30  up .21   Jan.
67.92  up  .32

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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