Linn Group Morning Soybean Comment

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

July soybeans closed 6 cents lower after making new contract highs overnight
Wednesday night. The Market was pressured by a sell-off in palm oil in
Malaysia and an overall overbought situation in the soy complex. Traders say
they are not surprised by the break with soybeans making 2 ½ year highs and
with bean oil near 23 year highs. Some traders say that yesterdays action in
palm oil could signal a key reversal with the market trading up 2% only to
end down 3%. Volume was heavy on Wednesday with an estimated 137,892
soybeans, 51,720 Oil and 50,575 meal futures traded. Funds sold an estimated
4,000 soybeans, 1,000 meal and 3,000 oil.

Overnight July soybeans traded 3 cents lower, oil slightly lower and meal
slightly higher. Traders say they are looking for some stability in the bean
complex after yesterdays sell off. Overnight trade in palm oil was higher
and should help calm fears. Today’s export sales were weaker than expected
with the USDA announcing net soybean sales at 202,200 mt for 06/07 and
25,000 mt for 07/08. Analyst range of expectations was quite a bit higher a
250,000 to 400,000 mt. Weather has remained favorable for crop development,
but there are concerns about dryness in the eastern Midwest. Overnight
Chinese Soybeans and meal traded lower. Malaysian Palm oil futures closed
mixed to mostly higher.

Early Opening Calls: 3 to 5c lower; soymeal 50c to $1; soyoil 10 - 20c lower

Top News

**USDA Soybeans 06/07 Export Sales Net: 202,200 mt; 07/08 Export Sales Net:
25,000 mt;  expected 250-400,000

**USDA Soybean Oil 06/07 Export Sales Net: 2,500 mt; expected Unch-10,000

**USDA Soybean Meal 06/07 Export Sales Net: 127,300 mt; expected 50-150,000

-- Goldman Sachs Index roll begins today. Index funds tried to jump ahead of
tomorrows Goldman Roll as Fimat, RJO, UBS and Rand all bought Nov and sold
July.

-- To subsidize local cooking oil REA Holdings' chairman said company will
have to sell up to 10% of its palm oil at a discounted price of $630/ton.

-- By June 1st soy producers in Brazil had sold 67% of their new crop, up
from the 65% that had been sold last week, according to analysts.

-- US effort to reduce dependence on foreign oil by emphasizing ethanol
production may be misguided, according to head of Alaron USA.

-- To offset increased price of grain and energy, General Mills will raise
prices slightly on cereal, according to a spokesman.

-- Dalian Soybean futures complex lower across the board.

-- Malaysian Palm oil futures rose 1% overnight

-- Malaysian traders speculate on talk of palm oil board bullish survey
showing only slightly higher production figures with a sharp decline in
stocks.

-- Funds on the day closed net sellers of an estimated 4,500 soybean
contracts

-- eCBOT Vol. 91,439; Pit Vol. 40,421; Open Interest Change: +427

-- Weather Above Normal Temps. Normal to Above Precip.Scattered showers and
thunderstorms will move west to east today into Friday.

-- Outside markets. Energy complex crude & gasoline futures higher; Gold &
Silver: both lower; US $ higher vs Euro & Yen

Cash Markets

--CIF Soybeans: June -5 to Option, July Option to +5, Aug. Option to +10,
Oct. +10 to +14, Nov. +18 to +26, Jan. +25 to +35



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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