Linn Group Morning Soybean Comment

CHICAGO - Feb 7/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Tuesday marked the 5th consecutive new contract high for March soybeans but
the market could not hold its gains closing 1 ¼ cent lower. After spending
most of the session in positive territory the market sold off in the last
half hour of trade losing 5 cents in the last 30 minutes. Soybean meal was
the leader closing 90 cents higher but oil closing lower. Volume was heavy
in soybeans with an estimated 128,048 futures traded and 39,048 options
traded. Funds on Tuesday were active buying 1,000 soybeans, 1,000 meal and
selling 2,000 Oil.

Brazil’s analyst AgRural said Tuesday the 2006/07 Soybean crop was forecast
at a record 57.5 mil. mt., up 2% from the 56.4 mil. mt. projected in
December. They projected the crop would be 8% higher than last year’s 53.4
mil. mt. despite a 4% reduction in the planted areas. Today begins the
Goldman Sachs index fund roll from March futures. It is widely expected that
they will roll 20% of their position each day for the next 5 days. USDA
supply and demand report is due out Friday morning with analysts expecting
Carryout averages in soybeans to be 569 vs. 575. The US Army Corps of
Engineers has issued navigational advisories for the upper Mississippi River
above St. Louis due to icy conditions and low water levels which could slow
the flow of traffic on the River. Overnight Chinese soybean futures closed
firm, meal closed higher. Malaysian palm oil futures closed firm.

eCBOT Overnight

Contract            Last      Net Change       High      Low

ZSH7                740^4    1^6                   740^6    737^0

ZSK7                756^0    1^6                   756^0    752^2

ZSN7                769^0    0^2                   769^4    766^4

ZSQ7                773^0    -3^0                  773^0    773^0

ZMH7                213.6    0.3                    213.6    212.7

ZMK7                217.8    0.0                    217.8    217.3

ZLH7                 30.45    0.08                  30.48    30.35

ZLK7                 30.84    -0.05                 30.89    30.84

ZLN7                 31.33    0.01                  31.33    31.26

Opening Calls:

Top News

-- USDA Secretary:  "Early out" for CRP ground is still under consideration,
wouldn't happen until 2008 at earliest

-- District judge rules against GMO's - insists USDA do more tests on GMO's
affects on the environment

-- Agrinvestor analyst predicts Brazilian soybean crop could top 60-65 mln
mt in 2008, 75-mln mt by 2009, on farmer optimism about prices.

-- Ukraine's Deputy PM announces plan to allow an extra 864,000 tons of
grain to be exported, will discuss whether to eliminate export quotas
altogether

-- Canada's Grain & Oilseed production outlook expected to rise 2.8 mln mt
to 67.2 mln mt on higher yields & larger area planted.

-- Canada's 07-08 canola production is forecast to rise 8% in latest report
by Agriculture & Agri-Food Canada report. On higher seeding area offsetting
lower expected yields.

-- UBS to initiate new agriculturals team within its commodities business -
in London, deal w/ institutional clients and corporate clients.

-- The Goldman roll starts today.

-- Chinese Soybean, & Soybean Oil futures closed lower.

-- Fund sold 1,000 Soybeans, 2,000 Oil.  Bought 1,000 Meal.

-- Soybean spreads: Term 1,500 SX/SN, ADM 1,300 SH/SK, JPM 400 SH/SK, RJ 700
SH/SK



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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