Alaron Grains and Oilseeds Comment

CHICAGO - Jul 18/07 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

Corn:

Monday's 3:00p central time crop progress and condition report put 56% of the corn crop in its key yield development time. It put 64% of the crop in good to excellent condition down 6% from the week prior but 2% over a year ago. Illinois came in at 79% in G-E condition down only 2% from the week prior and with what appears to be decent rain into Thursday for Illinois and 88% of their crop at key yield time, they will have the best crop of all the Midwest key producers. Eastern belt rains through Thursday, look to improve our poorest quality states as well. Indiana was down 8% on the week at 43% G-E with Ohio down 11% at 39% G-E but those states will improve on next Monday's update. The western half of the Midwest grain belt does not look good. Iowa at 63% G-E was down 9% on the week and Nebraska at 74% down 6%. The western grain belt Wednesday and Thursday look to get some rain but totals and coverage are uncertain. Wxrisk.com sees after Thursday a very hot and dry trend develops this week end into next week. Wednesday low should be bought lightly as longs slowly leg back in.

Beans-

Monday afternoon crop condition report put our crop at 62% in G-E condition down 3% from the week prior and 5% over a year ago. Winners were Illinois at 76% unchanged on the week and Wisconsin at 70% down 1%. Losers were Indiana 40% down 5, Iowa 65% down 7, Minnesota 53% down 12, Nebraska 67% down 9 and Ohio 38% G-E down 7% from the week prior. We can throw that all out the window, as it is what happens starting next week through august 10th to the 15th that is going to determine bean yields as we will have 40% or more in the key yield pod setting stage. Monday's report showed only 14% of the crop is building the pod with the bean. This essentially means the key yield time for some of the crop has begun but a much larger percentage kicks in next week making weather and its impact on the crop critical to ending yields and eventually ending stocks for next year. Like I mentioned in my corn commentary, eastern grain belt states look to see enough rain to improve their states soy bean quality on next Monday's report but the western grain belt states look uncertain. We have drier conditions this week end into early next week as we enter key yield development time. With 11 million less acres planted this year, there is no margin for error in the growing season. Wednesday low should hold for the week as warmer, drier conditions ahead bring back a weather premium.

Wheat-

The Monday crop progress report put harvest of our winter wheat crop at 70% complete. Crop condition ratings are over for this crop. Our spring wheat crop is 93% in the key heading stage for yield development. 76% was in G-E condition down 2% from the week prior and 9% under our high of five week's ago but well over last year's disaster of 34% G-E. The crop ratings are declining but we are still at high ratings overall but the end of the growing season into August 1st may not be good to our spring wheat states as the Dakotas into Montana look to see generally dry condition while temperatures over 100 will be seen late week lasting into early next week. Remember, spring wheat futures are delivered on the Minneapolis Exchange Futures.

Tim Hannagan

Alaron Research Team

800.563.9510

thannagan@alaron.com

www.alaron.com

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