Linn Group Morning Soybean Comment

CHICAGO - Apr 3/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybeans rallied and closed 17 ¾ cents higher. After opening weaker in
response to the locked limit down corn market Soybeans began a steady price
rally mid session through the close. Traders say as the price of corn vs.
soybeans relationship widens, it could trigger farmers to switch intended
corn plantings back to soybeans. Weather and price will still influence
farmer plantings. The weekend rains have left a large portion of the growing
areas very wet and more rain is forecast for the next 48 hours. We still
need to get these acres all planted and grown and weather and price will
greatly affect the actual plantings. Volume was extremely heavy with a
record 204,253 soybean futures traded and 37,869 options.

Today opening calls are steady to lower as traders focus on consolidation
likely at the open after the strong gains on Monday. Overnight, soybeans
settled down ¼ cent. Overnight Chinese Soybeans and meal closed higher.
Malaysian Palm oil futures closed higher. Brazil Grain analyst Celeres
issued a new estimate for Brazil Soybean production at 58.5 mmt vs their
previous estimate of 58.0 mmt. Heavy rains have almost totally halted
Argentina's 2006/07 soybean harvest and flooded fields in some areas and a
significant proportion of plants are under water which could threaten
yields, the Buenos Aires Grain Exchange said.

eCBOT Overnight

Contract            Last      Net Change       High      Low

ZSK7                778^6    -0^2                  782^6    775^0

ZSN7                794^0    -1^6                  798^0    790^4

ZSQ7                799^0    -2^0                  801^0    799^0

ZSU7                807^0

ZSX7                 821^0    -0^2                  824^4    818^0

ZMK7                218.4    0.1                    219.5    218.0

ZMN7                223.3    0.1                    224.5    223.1

ZMQ7               226.1

ZLK7                 32.76    0.00                  32.88    32.62

ZLN7                 33.30    -0.07                 33.36    33.20

ZLQ7                33.58

Early Opening Calls: steady to lower; Soymeal steady; Soyoil steady to 10c
lower

Top News

-- US Ethanol production in the month of January reaches new record:  375k
barrels per day - demand still stronger at 414k, acc. to ethanol industry
sources.

 -- South Korea - US trade deal the largest in 15 years;  expected to help
meat producers, US/Korean auto industries - although US auto executives say
pact falls short of expectations

-- Soybean spreads:  ABN 1,200 SK/SN, JPM 600 SK/SN, ADM 200 SK/SN

-- eCBOT Vol. 145,371; Pit Vol. 61,862; Open Interest Change: +5,005

-- Funds sold 20,000 Corn, 4,000 Wheat. Bought 8,000 Soybeans, 5,000 Meal,
3,500 Oil.

-- Weather: Below Normal Temps. Below Normal Precip, 6 - 10 day shows.

-- Outside markets: crude oil futures lower; US $ slightly higher vs Euro;
higher vs Yen; Gold & Silver lower

Cash Markets

-- CIF Soybeans:  Apr. +14 to +18, May. +17 to +22, June +6 to +12. July +9
to +20, Aug. +10 to +15. Oct. +22 to +26

-- Processors: Decatur  -25   Danville –30   Bloomington –30  Gibson City
–25



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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