Linn Group Morning Soybean Comment

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

Soybeans ended Wednesdays session down 8 ¾ cents. It was an outside day and
the market failed to hold its rally once it climbed into the gap left from
Monday July 23rd. The gap in November soybeans was from $862 to $869 ½ and
yesterdays high of 867 was enough to satisfy the upside move for now traders
say. Traders say worries about credit markets and subprime mortgage problems
are spilling over into markets like soybeans and other agricultural markets.
One trader said that there is an overall risk reduction in all markets by
large funds and investors, keeping a lid on rallies and pressuring many
markets. Volume on Wednesday was moderate to heavy with an estimated 127,893
soybean futures traded, 60,160 oil futures and 58,527 meal futures traded.
Funds sold an estimated 2,500 soybeans, 4,500 oil and 1,000 meal.

The USDA released the weekly export sales figures today showing 06/07 Net
sales of 185,100 mt; 07/08 Export Sales Net: 255,200 mt; expected
250,000-450,000. Yesterday started the release of private production
estimates with FC stone being the first to release. Their estimates for
soybean production of 2.681 bil. bu. compared to the USDA estimate of 2.625.
Yield estimate of 42.4 bpa. vs. USDA estimate of 41.5. Informa economics
estimate is due out today. Brazil reports July soybean exports at 3.09 mmt.
down 29% from a year ago. Overnight, Chinese soybean and meal futures closed
lower, oil higher. Malaysian Palm oil futures rose 7.0% overnight

Early Opening Calls: 7 to 10c higher, soymeal $1 higher; soyoil 15 - 25c
higher

Top News

**USDA Soybeans 06/07 Export Sales Net: 185,100 mt; 07/08 Export Sales Net:
255,200 mt; expected 250,000-450,000

**USDA Soybean Meal 06/07 Export Sales Net: 76,800 mt; expected 50-100,000

**USDA Soybean Oil 06/07 Export Sales Net: 24,000 mt; expected Unch-10,000

-- Minneapolis bridge collapse closes Mississippi River near site.

-- Brazil foreign trade office says July exports of soybean oil fell to 193k
mt down from 201k mt in same month year ago. June soyoil exports totaled
169k mt.

-- Brazil foreign trade office says July exports of soybean meal fell to
1.23 mln mt down from 1.67 mln mt in same month year ago. June exports
totaled 1.19 mln mt.

-- Brazil foreign trade office says July exports of soybeans fell to 3.09
mln mt down from 4.38 mln mt in same month year ago. June exports totaled
3.07 mln mt.

-- FCStone released late Thursday afternoon corn & soybean production
estimates.  Group sees this year's national corn yields at 148 bu/ac., and
total production at 12.64 bln bu.  The estimated overall soybean production
at 2.681 bln bu, at an avg yield of 42.4 bu/ac.  In Illinois production of
corn was estimated at 2.28 bln bu & yield of 176 bu/ac, beans 407 mln bu
with yield of 49 bu/ac.  Iowa corn harvest 2.33 bln bu with state yield of
167 bu/ac., while soybeans estimated at 447 mln bu and yield of 51 bu/ac.
Nebraska corn harvest at 1.418 bln bu on yields of 163 bu/ac., while
Minnesota corn harvest pegged at 1.048 bln bu and yields of 137 bu/ac.

-- Dalian Soybean futures lower, Jan 26 yuan lower; soymeal under pressure,
Jan 19 yuan lower; active Jan soyoil 6 yuan lower, rest of complex unch to
higher

-- Malaysian Palm Oct futures rose 17 ringgit overnight, oil traders
watching eCBOT & Chinese soyoil prices

-- eCBOT Vol. 87,235; Pit Vol. 38,479; Open Interest Change: -4,681

-- Weather: Above Normal Temps. Normal to Above Precip West, Below East.

-- Outside markets. Energy crude lower, product lower also; Gold & Silver:
both higher; US $ lower vs Euro, higher vs Yen

Cash Markets

--CIF Soybeans firmer up 2 to 9. Aug. opt. to +6, Sept. +8 to +12, Oct. +16
to +20, Nov. +27 to +32, Dec. +20 to +30,  Jan. +28 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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