Linn Group Morning Soybean Comment

CHICAGO - Jul 2/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybean values surged on Friday after the release of the widely anticipated
USDA acreage and supply report. Analysts expected the USDA to report 67.140
million acres of soybeans to have been planted by farmers but actually only
64.081 mil. acres were planted causing a limit up reaction shortly after the
open. The November soybeans were locked limit up for the first 2 hours. July
soybeans went into delivery on Friday. With no limit on the deliverable
contract July soybeans traded 66 ¼ cents higher at one point during the
session.  Volumes were extremely heavy in the soy complex with an estimated
232,288 soybean futures traded, 102,053 soybean oil futures traded and
76,829 meal futures traded. Funds were active as well buying an estimated
6,000 soybeans, 5,000 oil and 4,000 meal.

Follow through buying is expected today following Fridays price rally. Early
opening calls for soybeans are 8 to 10 cents higher. The  Commitment of
traders released by the CFTC  showed large speculators long 138,946 lots,
down 15,166, and short 22,350, up 572. Index funds were long 147,517, up
1,909, and short 3,069, down 616. Reports from Buenos Aires say Argentine
soybean crushers processed 3.44 mil mt. of soybeans in May, a 31% increase
compared with the same month a year earlier. High global prices coupled with
low production costs have led to a sharp increase in Argentina’s crushing
capacity in recent years. Overnight Malaysian Palm oil futures rallied 1.7%
on renewed buying interest spurred by the rally at the CBOT on Friday.
Chinese soybean futures closed higher.

 Early Opening Calls: 7 to 10c higher; soymeal $2 higher; soyoil 30 to 40c
higher

Top News

-- Ag Sec in Argentina reports 31% increase in soybean crushing during May
2007 to 3.44 mln mt compared to yr ago month crushing. Gov't cites low
production cost & rising global prices for finished product helping boost
country's crushing output

-- 991,620 mt of Malaysian palm oil exports during June acc. to Intertek
ship surveyor

-- Suez Canal at standstill as officials for the canal authority say bulk
cargo ship breaks down impeding other ships in the canal. No timeframe was
given to clear the backlog of ships

-- Dalian Soybean futures closed higher; higher closes for soymeal & soyoil
overnight as well.

-- Malaysian Palm oil futures rose 1.6% overnight.

-- eCBOT Vol. 118,177; Pit Vol. 110,724; Open Interest Change: -2,456

-- Outside markets. Energy complex lower; Gold $5 higher & Silver 14-15c
higher; US $ lower vs Euro & Yen

Cash Markets

            Bean Barge       Corn Barge        SRW Barge       HRW Track
Ill Riv Frt

June     +0/10 N             +47/49 N             -20/-15 U         +70/ U
370

July      +0/10 N             +47/50 N             -15/-5 U           +70/ U
360

Aug      -10/0 Q             +44/47 U             +0/5  U           +70/ U
370

Truck                Beans   Corn     Wheat   Meal Hi-pro        Oil

Chicago                       -37 N    +2 N    -45 N

Toledo              -40 N    +2 N    -70 N

Dec ILL            -30 N    +5 N                           -3 N      -225 N



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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