Linn Group Morning Soybean Comment

CHICAGO - Jun 8/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Thursday’s trade took July Soybeans to a new contract highs and new contract
high close ending the session up 9 ¾ cents. Traders say the market gained on
technical buying following the strength in corn and soybean oil. Soybean oil
was supported by a $1.50 rise in crude oil and a higher Malaysian palm oil
market Wednesday night. Estimated soybean volume was large and product
volume was moderate to heavy. Soybean trade was estimated at 155,844
futures, oil volume at 49,232 futures and meal volume was 39,234. Funds
turned very aggressive buyers Thursday buying 12,000 soybeans, 2,000 meal
and 3,000 Oil.

Overnight July soybeans gave back much of the gains from Thursday, ending
the night session off 8 ½ cents and July bean oil ended the night session
down 64 points. Traders say much of the break overnight is being attributed
to Palm oil prices being down 4% overnight amid talk that Indonesia is
likely to delay plans to raise it’s cooking oil export tax. Technical
traders also point to the fact that we are moving into major long term price
levels that could be completing this bull run for the moment and could be
responsible for the break overnight. Crop weather in the U.S. Midwest
continues to unsettle the market and the 6 to 10 day forecast calls for
above normal temperatures and Normal to above normal precipitation. Bean
basis remains under pressure in the US but South America appeared to firm
slightly today on the heels of a break in the Brazilian Real currency. Oil
Basis continues to firm as more of the world consumption looks for a cheaper
alternative to canola and palm oil. Overnight Chinese soybeans and meal
closed lower. Malaysian Palm oil futures ended the session down 4%.

Opening calls: Soybeans 7 to 10 lower, Oil .40 to .60 lower. Meal $ 1.00 to
$1.50 lower.

-- Monday is USDA Monthly Supply/Demand Report

-- US-China Trade Deficit widens +$2.12 bil to $19.37 billion, acc to
customs data

-- US April Petroleum import prices pegged at $57.28/bbl up from the
$53.00/bbl avg price in March.

-- Indonesia is possibly raising export tax on palm oil from 1.5% to 6.5% if
local palm and crude oil stay higher than 7,000 rupiah/kilo, according to
their Trade Minister.

-- Indian imporrts won't feel the full effect of sky-rocketing palm oil
prices due to cuts on customs duties and a strong rupee.

-- Plant biologists note the appearance of soybean aphids on plants in
Minnesota and Wisconsin, acc. to Iowa State University

-- Dalian Soybean futures higher; soymeal mixed; soyoil higher on Friday
overnight trade.

-- Malaysian palm oil futures declined -6.6% to $713/ton after rumors
Indonesia may not raise export taxes on palm oil;  traders say market may
now be oversold

-- eCBOT Vol. 95,863; Pit Vol. 64,138; Open Interest Change: +7,524

-- Weather: Above Normal Temps.  Normal to Above Precip. The Corn Belt will
see scattered showers Friday

-- Outside markets. Energy complex lower; Gold & Silver: both lower; US $
higher against both Yen & Euro

Cash Markets

--CIF Soybeans:   June -10 to Option, July -2 to +3, 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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