Linn Group Morning Soybean Comment

CHICAGO - Feb 12/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

March Soybeans ended Fridays session 5 ½ cents higher closing march beans at
749 ½ a new contract high close.  This is the highest front month close in 2
½ years. For the Week March soybeans added an additional 12 ½ cents from the
previous weeks close. Traders say the USDA numbers released Friday morning
were moderately bearish but the market showed its resiliency as prices
continued to trade higher throughout the session indicating a technically
strong market in spite of relatively bearish fundamentals. Funds were active
on Friday buying an estimated 6,000 soybeans, 2,000 meal and flat in oil.
Volume was heavy on Friday with an estimated 188,622 soybean futures traded
and 41,666 options.

Friday's CFTC commitments of traders report for futures and options combined
showed that as of last Tuesday, large speculators were long 125,607
soybeans, up 11,398 from the previous week and short 28,820, down 1,529 .
Index funds were long 139,590 , up 1,760  and short 3,748 , down 197. Meal
long 56,594 , up 3,377 from the previous week and short 17,244 l, down 2,407
and oil large speculators were long 82,875 , up 15,308 from the previous
week and short 13,850, up 6,227. Index funds were long 72,324, up 3,360 and
short 286, down 1,023. The South American soy crop is progressing very well
and Argentina’s Ag. Secretary said the soil is sufficiently moist and with a
record area being planted the harvest is expected to dwarf last years 40.5
mil. mt. Reports from Brazil show that concerns about delayed soy harvest
could occur due to rain in that region. Overnight Chinese Soybeans closed
flat to firm, Meal weaker. Malaysian Palm oil futures closed weak.

eCBOT Overnight

Contract            Last      Net Change       High      Low

ZSH7                748^4    -0^6                  752^0    747^6

ZSK7                764^2    -1^2                  767^0    763^2

ZSN7                777^6    -0^6                  780^4    777^0

ZMH7                218.0    0.1                    219.2    217.9

ZMK7                224.1    1.0                    224.1    222.8

ZMN7                228.0    0.8                    228.0    227.0

ZLH7                 30.30    -0.04                 30.40    30.19

ZLK7                 30.80    -0.06                 30.88    30.70

 Opening Calls: ½ to 1 cent lower.

Top News

-- Export News: S Korea purchased 55,000 mt of Brazil soybeans

-- Analysts note bullish bias for grain markets today after Friday's
technical higher close, tightening stocks of cash grain and today's seasonal
buy date for corn and beans.

-- American Soybean Assoc. will propose its farm bill ideas in a morning
teleconference.

-- USDA Sec. Johanns will go before congressional committees this week.
Expected to be grilled about the departments proposed farm bill & budget
requests.

-- Grain markets to shift focus to weather w/crop report behind - analysts
note that weakening El Nino generally results in below trendline yields for
corn and beans.

-- Chinese Customs:  Jan '07 soybean imports seen at 2.43 million tons,
+43.8% over Jan '06 - down very slightly from Dec '06

-- Malaysian Palm Oil down 0.7% to $545/mt overnight ahead of key report -
Jan. output fell 2.5% to 1.115-mln. mt., acc Malaysian Palm Oil Board.

-- Malaysian palm oil output declined -2.5% to 1,115,000 tons in January,
compared to Dec '06 - stocks also down -2.1% to 1.474 mil, acc. to MPOB

-- OPEC officials to hold off on additional output cuts ahead of Mar. 15
meeting - market reaching a balance.

-- Russian gov't to cut export tariff on Rapeseed from 20% to 15% to bolster
exports - country saw a 76.6% jump in 2006 Rapeseed production to 530k mt.

-- Soybean futures open interest grew by 7,430 contracts; soy oil open
interest was up 1,643; soymeal open int. up 4,754.  Electronic soybean
volume was 105,070.  Pit volume was pegged at 90,816.

Cash Markets

            Bean Barge       Corn Barge        SRW Barge       HRW Track
Ill Riv Frt

Spot                             +48/

Feb       +30/35 H           +46/49 H           +13/18 H           +70/75 H
375

Mch      +30/34 H           +45/47 H           +19/23 H           +74/80 H
330

Apr       +19/22 K           +35/38 K           +8/ H                +70/75
K           320

May      +21/25 K           +36/39 K
+70/78 K           310

Truck                Beans     Corn   Wheat              Meal Hi-pro
Oil

Chicago                       -29 H    -19 H   -43 H

Toledo              -30 H    -18 H   -45 H

Dec ILL            -18 H    - 2 H                           -15 H
-225 H



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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