Alaron Grains and Oilseeds Comment

CHICAGO - May 4/07 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

Corn:

Thursday's weekly export sales report showed 615 t.m.t. of corn was sold last week off 44% from the week prior, 35% below our strong four week average and under a year ago of 1.280 m.m.t. Though down on the week regular weekly buyers Asia were in for 418 t.m.t. versus 370 the week prior with drought stricken Mexico in again for 186 t.m.t. It is not bullish but as long as Asia finds the exchange rate favorable and grain values affordable were in a positive demand cycle as Asian markets buy 70% of our exportable grains and corn to ethanol continues to expand. Again this week weather and its impact on corn planting progress decided our daily direction. Monday brought a outlook for mainly dry conditions leaving corn basis December new crop futures to drop to 15 week lows. Only to find Tuesday bringing a sharp rally after our late Monday crop progress report showed planting further behind than expected. Wxrisk.com calling for rains to move into the southern Midwest and western and northern plains mid-week. We have gone from 50 to 100 million dollar trading funds 5 years ago to billion dollar trading funds, finding every piece of news daily no matter how small, to throw money at leaving us with near record weekly trading ranges. Once the crop is planted then weather and its effect on condition and yield will promote even bigger daily and weekly ranges. Planting this week ended up slower than hoped for when it began but it was best planting week yet. I look for 52 to 57% seeded on Monday's report at 3:00p central and 90% planted by May 25th. 60% of the crop is going in during the last half of the preferred planting dates but bio-genetic seeds do fine when crops mature in later summer when it is hotter and drier. The last two year show the seeds needing a third less moisture for normal yields and thrive in the heat of July.

Beans:

Thursday's weekly export sales report showed that due to china cancelling previous purchases and moving them to the new marketing year after September 1st, we had a negative 70 t.m.t. sold. This is not a uncommon thing. Every year this time when South America is shipping cheaply their harvest, China will switch over booked order into the next marketing year. It is more neutral to the market than bearish. As we had sales now of 542 t.m.t. for the new marketing year. They did not cancel for no need but changed the date of shipment. We saw a slight change in trading psychology for beans as we entered May. In April when corn is planted, rain delays slowing corn planting led to a thinking if continued, would lead to less corn planted and more beans as beans are planted in May. This had traders buying corn and selling beans as a spread. May is seeing that trading strategy begin to fade as rain delays for corn seeding also means bean delays. My long term strategy remains the same to buy breaks on Nov. new crop futures. Next support is 7.68 today Friday and 7.70 Monday with a closer over 7.94 as break out resistance. Our April 25th low of 7.51-1/2 look not to be revisited with talk of 8 million less acres going to see and a La Nina hotter and drier summer called for.

Wheat:

Thursday's weekly export sales report showed 152 t.m.t. of wheat was sold last week down 45% from the week prior. 60% under a weak four week average and behind last year's 388. Asia bought only 22 tm.t. of feed quality wheat. They had been more active in previous weeks. Demand remains poor until new crop purchases begin in June. Well, it appears the worst of the news about the Easter week end winter wheat crop freeze is begin us. Crop tours this week by mainly inexperienced agricultural people suggest the crop is better than expected. It is going to take a crop production estimate by the USDA to get a feel for crop size, in the meantime weekly Monday 3:00p USDA crop condition reports are improving. This past week saw warm sunny days and timely rain looking to bring improved ratings on Monday next update. It does not look like any surprises like very low test weights or burnt by freeze unable to head out wheat will show up until late month, so if Monday updates continue to improve the downside is certain.

Tim Hannagan

Alaron Research Team

800.563.9510

thannagan@alaron.com

www.alaron.com

DISCLAIMER: The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities. Alaron Trading Corp. its officers, directors, employees and brokers may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Information on this page is derived from third parties and is deemed to be reliable. STAT Communications Ltd. accepts no responsibility for errors, omissions or inaccuracies in any of the material presented on this web site. Opinions expressed on this web site are those of the respective individuals and/or institutions and do not represent the opinions of STAT Communications Ltd. or its management.