Linn Group Morning Soybean Comment

CHICAGO - Aug 1/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

November soybeans ended Tuesdays session 9 ¾ cents higher on Tuesday, for
the highest close in the last 7 sessions. For the month of July, November
soybeans lost 24 ¼ cents and settled 92 cents off their monthly highs.
Tuesdays session opened a little better and continued to trade higher
throughout the session. Traders say the strength in the bean complex is
being attributed to above normal temperatures for the week and a weaker than
expected crop condition report which was released Monday afternoon after the
close. Volume on Tuesday was heavy with an estimated 143,043 futures
contracts traded, 70,740 oil and 52,993 meal traded. Funds on Tuesday bought
an estimated 3,500 soybeans, 3,000 oil and 1,500 meal.

Today’s opening calls are higher on continued concerns that the hot weather
now can interfere with the process of soybeans setting and filling pods. 6
to 10 day forecast continues to call  for hot dry conditions. However rains
for the next 5 days favor the dry areas in the west covering a good share of
So. Dakota, Min, NRE Nebraska and Northern Iowa. Wisconsin and Michigan are
also in the projected rainfall areas. Oil World newsletter forecast European
rapeseed crop for 2007 to fall by about 1 mil mt. due to rain during the
harvest and drought in early spring. Technical traders point out that beans
could break out of the recent range especially with a close above $ 8.60.
The USDA reports 165 tmt beans sold to unknown destinations under daily
reporting requirements. Overnight Malaysian palm oil futures closed lower.
Chinese soybean and meal futures closed higher.

Early Opening Calls: beans 2 to 4 cents higher. Meal .50 to $1.00 higher,
oil .05 to .10 higher.

Top News

-- Abiove 07/08 soybean crush estimate pegged at 30 mln mt, unchanged on the
month.

-- Oilseed industry group in France expects French rapeseed crop at 4.7 mln
mt down from its prior estimate of 4.9 mln mt.  The group lowered its
average yield per ha to 3.0 mt/ha from 3.1 mt/ha, but left acreage unchanged
at 1.57 mln ha.

-- Soybean aphids found in Kansas this year appeared around the same time
frame as in 2005, the first sighting this year was made on July 12.  The
2005 population never became troublesome but favorable temperature
conditions for reproducing have currently emerged, due to recent rains
cooling down the state.

-- Cash European grain traders suggest recent weather has negatively
impacted the sunseed crop doing irreversible damange.  Prices continue to
reflect this situation with trade as high as $1060 per tonne, up nearlyt$150
from early June levels.  Bulgaria is often mentioned as the hardest hit by
hot weather, but the Ukraine, Romania, and Turkey, among others, are also
suffering.  One trader suggested rapeseed, the normal replacement for
sunoil, looks very cheap suggesting that the crop of the big exporter,
Canada, needs to meet expectations.

CBOT Soy Complex Deliveries

----------------------------

Soybeans                      2,220

Soymeal                                     164

Soyoil                           2,367

-- Seed maker Monsanto company official says company to begin limited sales
of new GMO soybean seeds for the 2009 crop year and full sales distribution
for the following year.  The spokesperson says the new seed will increase
yields by 7-11%.

-- UK taxi company switching to B30, a 30% biodiesel blend with 70% petrol
diesel, for its fleet of cars.

-- May ethanol production 38% higher from year ago levels to 406,000 bpd
acc. to Renewable Fuels group

-- May ethanol use grew 22% higher from year ago levels to 427,000 bpd acc.
to Renewable Fuels group

-- Dalian Soybean futures ended overnight session higher, soymeal ranged
from 6 to 25 yuan higher, however active Chinese soyoil futures for Sept
ended 64 yuan higher, but most active Jan settled unchanged.

-- Malaysian Palm oil futures ended lower by 1.0% overnight. Lower soyoil
helped weigh on trade.

-- eCBOT Vol. 83,267; Pit Vol. 57,475; Open Interest Change: -333

-- Weather: NWS 6- to 10-day forecast for Aug. 6-10 shows above-normal temps
will remain centered over the Corn Belt.

-- Outside markets. Energy: crude oil 35c lower, products lower also ; Gold
$5 lower in Dec. & Silver: 16c lower; US $ slightly higher vs Euro, lower vs
Yen

Cash Markets

            Bean Barge       Corn Barge        SRW Barge       HRW Track
Ill Riv Frt

Jly        +45/46 U           +0/+8 U                        +55/  U
470

Aug      -5/+5 U            +46/49 U           +5/10 U             +60/ U
490

Oc/No   +12/18 X           +37/40 U           +30/ Z              +60/ Z
600

Truck                Beans   Corn     Wheat               Meal Hi-pro
Oil

Chicago                       -60 Q    +4 U    -75 U

Toledo              -55 Q    +8 U    -22 U

Dec ILL            -52 Q    -15 U                          -14 Q
-325 Q



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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