Linn Group Morning Soybean Comment

CHICAGO - Aug 7/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Unable to sustain any upside momentum soybeans closed 11 cents lower on
Monday.  Beneficial rains in dry northern areas of the Midwest and forecasts
for more rain this week are fueling the sell-off. Crop conditions have
deteriorated over the past several weeks due to a lack of rain, raising
concerns that yields may not be a sbig as previously thought. Soybeans
especially were the beneficiaries of the recent heavy rains. Traders say
soybeans can quickly absorb any rainfall which is very important as the
plant sets and fills pods at this time of year. Rainfall in general was
heavier than expected and caused the market to open nearly 20 cents lower
and remain there till noon with prices inching higher in the last hour of
trade. Soybean volume was moderate at 102,071 contracts traded, meal traded
an estimated 46,352 contracts and oil  57,176 contracts traded. Funds on
Monday sold an estimated 3,000 soybeans, 1,000 meal and 4,000 oil.

Yesterday after the close the USDA released the weekly crop conditions
report showing soybeans rated 56% good to excellent vs. 58% last week, 53%
last year and 57% average. The reduction of 2% in the crop conditions was
within analysts expectations. Basis levels are higher across the board and
demand for soybeans at the Gulf is up 29 cents from last week. Oil world cut
its forecast of the global 2007/08 soybean crop to 223.55 mmt., from an
estimated 237.17 mmt. Overnight Chinese soybeans closed lower in heavy
trade, meal higher and oil lower. Malaysian Palm oil futures closed higher
recovering late. Indonesia raised base export prices for palm oil products
to bring them in line with international prices, the trade ministry said.

Early Opening Calls: beans 2 to 3 lower; meal .50 lower; oil .10 to .15
lower

Top News

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

Soybean Progress & Conditions Mini-Recap

Soybeans % Blooming:  92%; 85% week ago; 92% yr ago week; 90% 5 yr avg.

Soybeans % Setting Pods:  69%; 51% week ago; 69% yr ago week; 61% 5 yr avg.

Soybean Crop Conditions Latest: VP= 4; P= 11; F= 29; G= 43; EX= 13

Soybean Crop Conditions Prior Wk: VP= 4; P= 9; F= 29; G= 45; EX= 13

Soybean Crop Conditions Yr Ago Wk: VP= 5; P= 12; F= 30; G= 41; EX= 12

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

-- 07/08 world soybean crop seen at 223.5 mln mt up from 237.2 mln mt in
prior marketing year - Oilworld

-- Crops forecaster, Celeres, sees 07/08 soybean harvest at 61.4 mln mt a
rise of 4.2% from year ago harvest

-- Through Aug 3, 14% of Brazilian 07/08 soybean crop sold, acc. to crop
forecaster Celeres

-- USDA reports 2 southwestern Arkansas counties with Asian soybean rust.
The counties were Miller & Lafayette.  USDA reiterated that conditions
remain favorable for rust conditions throughout the south.

-- After confirming its first case of 'foot & mouth' disease, the UK
announces another suspected case of the disease that is near first

-- Monday's Weekly Grain Export Inspections, Soybeans:  10.489 mil bu,
expected = 7.0 mil bu, previous = 7.537 mil bu

-- Dalian Soybean futures lower in active overnight trade, Jan soymeal 1
yuan higher, but other active months lower, Jan soyoil lower.

-- Malaysian Palm futures traded 2.7% lower at one point during the session,
but late buying lent support and finished only marginally 2 ringgit lower.

-- CBOT Deliveries:

Soybeans          2,084

Meal                   171

Oil                      902

-- eCBOT Vol. 69,302; Pit Vol. 30,745; Open Interest Change: -1,871

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

-- Outside markets: Energy complex: crude & products up slightly ; Gold &
Silver lower; US $ slightly higher vs Euro & Yen

Cash Markets

--CIF Soybeans higher up 2 to 12. Aug. +12 to +17, Sept. +14 to +16, Oct.
+27 to +32, Nov. +33 to +44, Dec. +25 to +30,  Jan. +33 to +??



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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