Linn Group Morning Corn Comment

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

The corn market closed higher again on Wednesday with the weather dominating
the market.  The forecast for wetter weather was increased for this weekend
and into the beginning of next week.  On the flip side, it seems like every
call we took yesterday had farmers telling us they were planting corn and
many said they were almost done and getting ready to plant beans and the
ground was excellent.  Many of these calls came from Iowa which had very
little planted last week and was wet.  Corn planting is behind the 5 yr
average, but a lot of corn is being planted this week and many traders feel
we are going to see the biggest jump in acres planted of all time when the
new USDA crop progress numbers are released on Monday afternoon.  This jump
may be especially big because many feel the numbers last week were too low.
The July contract closed 4 ½ higher and the December closed 1 ½ higher as
the bull spreads gained some ground yesterday.  The volume was average to
light and funds bot app. 5-7,000 contracts.  Traders are still looking at
the spreads as a key player in the corn market along deliveries.  Deliveries
were heavy again yesterday with scattered stopping by commercials.

eCBOT market was higher overnight as the weather forecast continues to point
to more rain for the next 3-5 days covering different areas of the Midwest,
thus slowing plantings.  This time of year is dominated by weather forecasts
and this year is no different, probably even more so because of the huge
estimate of acres planted.  Export sales were a little weaker than expected
this morning.  Traders estimated sales of 800,000 to 1 mil and the actual
sales were 615,000.  This wasn’t unexpected, with So. America in the middle
of harvest, a lot more grain is being exported out of So. America than the
US.  As has been the case the last couple of weeks, weekly export sales will
have a very small affect on the corn market and will be quickly forgotten
after the market opens.  Look for the corn to open inline with last night
closes, but I don’t think anything has changed in corn and it is still a
range trade.  The forecast for wet weather will certainly curtail planting
for this weekend and early next week, but a lot of corn got planted this
week and the market is expecting to see those numbers verified in the USDA
crop progress report next Monday.  The corn market should find selling up
against their recent highs if we get there today.

eCBOT Overnight

Contract            Last      Net Change       High      Low

ZCK7                375^0    3^0                   375^0    370^0

ZCN7                385^2    3^2                   386^0    379^6

ZCU7                383^6    3^0                   385^0    379^6

ZCZ7                 383^2    3^0                   384^0    378^6

Early Opening Calls: 2 to 4c higher

Top News

**USDA Corn 06/07 Export Sales Net: 615,000 mt; expected 800,000-1.0 mln

-- Argentine grain carryover pegged at 17.23 mil tons for March - up +24%
from last estimate, but down -10% from last year same time

-- 5 and 1/2 year old dairy cow in Canada diagnosed and confirmed to have
Mad Cow Disease, acc. to gov. sources

-- Dalian Corn futures on holiday

-- eCBOT Vol: 142,455; Pit Vol.: 62,055; Open Interest change:+3937

-- Outside markets. Energy lower; US $ slightly higher; Gold & Silver higher

Cash Markets

            Bean Barge       Corn Barge        SRW Barge       HRW Track
Ill Riv Frt

May      -2/+4 N            +22/25 N             +3/?? N           +75/ N
215

June     +7/11 N             +28/30 N             +3/?? N           +55/ N
225

July      +12/16 N           +33/36 N             +5/?? N           +55/ N
250

Truck    Beans  Corn    Wheat  Meal Hi-pro        Oil

Chicago            -35 N   -6 N     -40 N

Toledo   -40 N   -19 N   -52 K

Dec ILL -30 N   -10 N                -12 N              -200 N

TREND:

The wheat corn spread appears headed back to a level that can put wheat back
into feed rations. Look for a test of 90 over.

Corn has aims on 3.90 CZ. Not sure what it does when it gets there. Consumer
pricing will have a bearing?  Look for stoppers in deliveries and spreads
that want to gain more. N/Z could get back to 10 to 15 over on the basis
gains. To do more will take some damage to the crop or even more evidence of
lost acres to beans?



If you have any questions or want to discuss specific trade recommendations,
contact me directly.

Jim Riley
Linn Group
877-787-6278
jriley@linngroup.com
www.linngroup.com/

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