Alaron Grains and Oilseeds Comment

CHICAGO - Jun 8/07 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

Corn:

Thursday's weekly export sales report showed 375 t.m.t. of corn was sold last week down 45% from the week prior, 55% under our four week average and under a year ago of 867. Asian sales were low at 243 t.m.t. No concern as I pointed out last week, we are in a pattern of one big week of sales then the next week smaller, then back to beg again. It is an every other week rotation that in the big picture has demand overall very good. Monday at 7:30a central time we have our monthly USDA crop production report. Corn and beans will have only the carry over or ending stocks numbers for this year and next. Traders will look for adjustments up or down on the 2008 carry over for price direction as this year's carry over is well known and priced in. The trade should expect the 2008 carry over to be unchanged as the government may want to wait for their final planted acres report on June 30th before adjusting numbers. The average trade guess for our 2007 ending stocks is 947 m.b. versus 937 last month and 2008 at 997 versus 947 m.b. last month. It should be a non-event report that has traders turning to weather and its impact on emerging corn fields shortly after the open. Wxrisk.com see a very dry pattern in the eastern grain belt in his 6 to 10 day outlook with some rain in the wet western belt late week. If true, and rains stay out of our very dry eastern belt December new crop futures will rally to 4.04 then 4.16. If the American weather model calling for rain east next Wednesday and Thursday is right then 3.74 support will be tested. The American weather model runs have been horrible weekly, consistently being wrong, so it seems more probable that our La-Nina pattern of drier than normal east will prevail.

Bean.

Thursday's weekly export sales report showed some pressure from recent contract high prices coming in at 200 t.m.t. sold down 42% from the week prior, 6% below our four week average, but over a year ago of 180 t.m.t. Reason: No China Business. Just a soft spot in what is a very long term bullish demand scenario. The dry eastern grain belt weather this week brought big gains from Monday's low of 8.41 to Thursday 8.66 highs before funds cashed in and went to the bank with profits Friday. With bean crops in very early stages of development one dry week does not kill it or a wet week make a crop, so when the market gets fat with profits on the week we can expect set backs only to create good buying opportunities. We will continue to trade the next forecast as aggressively as if it yield development time mainly to do with the fact there is too much money trading the market with nothing to do but over buy and sell what currently is meaningless news. Once we hit key yield time, ranges will expand to even 50 cent limit hits. In the mean time if wxrisk.com is right on a 6 to 10 day dry forecast, November beans will push to near 9.00 on the 10 day period. If rain surfaces 8.20 to 8.32 is worst case scenario. Monday's USDA crop report has the average trade guess for our 2007 ending stocks at 598 m.b. 12 m.b. under last month and next year's 2008 at 328 m.b.

Wheat.

Thursday's weekly export sales report showed 347 t.m.t. of wheat was sold last week versus 320 a year ago as we are now one week into wheat's new marketing year. Regardless of recent price gains demand continues to climb as harvest availability in the US is now and the southwest harvest is underway. With wheat production problems in Russia, China and Australia, US Ports look attractive for high quality and quantity milling wheat. Monday's USDA monthly crop report ahead of the opening is expected to show a slight increase in all winter wheat production over the May report based on pre-report polls but be careful here as the last several crop condition reports suggest declines in quality could lead to a drop in production easily. Support on December wheat lies at 5.38/

Tim Hannagan

Alaron Research Team

800.563.9510

thannagan@alaron.com

www.alaron.com

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