Linn Group Morning Soybean Comment

CHICAGO - Aug 8/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybeans closed 12 ¾ cents higher in the November contract on Tuesday.
Traders say the strong storms  bringing in heavy rains across the northern
Midwest were beneficial to the soybean crop but the missed areas in the
southern sections of the growing area are in dire need of rain. Traders
estimate that 20 to 21 mil acres of beans are subject to damage because of
heat and lack of rain. All of Missouri, Arkansas, 1/3 of ILL. 1/4th. of
Indiana and Ohio are all problem areas. Highs are expected to remain in the
90’s for much of the Midwest this week. Volume on Tuesday was low with an
estimated 80,764 soybean futures traded, 46,048 bean oil futures traded and
37,430 meal traded. Funds bought an estimated 4,000 beans, 3,000 meal and
1,500 oil.

Today’s calls are higher with soybeans called to open 5 higher on continued
Follow-through strength from Tuesday's strong close. Traders say the market
should be supported by concerns about dry conditions limiting yields in the
southern U.S. crop region. Traders caution of short-covering expectations
ahead of the USDA's August supply/demand reports on Friday. Overnight
Chinese soybeans, mea, and oil closed higher. Malaysian Palm oil futures
closed higher.

Top News

-- Friday USDA supply/demand report, analyst expect soybean production at
2.653 bln bu, on yield of 41.9 bu/ac

-- 10,000 mt of soyoil & 9,000 mt of sunflower oil bought by Egypt

-- Iran buys S American soyoil.  Traders estimate the volume near the tender
amount of 35,000 mt.

-- 2007 soybean crop in China cut to 14.8 mln mt down from previous estimate
of 15.0 mln mt, acc. to CNGOIC.  They attribute the decline to drought
gripping some key growing areas of the country

-- CNGOIC, the Chinese gov't think tank, sees imports of soybeans up to 31.5
mln mt in the upcoming marketing year.

-- National Hurricane Center will release an update seasonal storm forecast
Thursday morning. After Colorado State revised downward number of Atlantic
hurricanes by 1, a NY-based energy analyst wouldn't be surprised if NHC
lowers their estimate also

-- USDA soyrust website says north central Oklahoma has confirmed Asian
soybean rust in sentinel plot in Payne County, just 60 miles south of Kansas
state line.  Farthest north soy rust has been confirmed, but plot had 1%
incidence rate.

-- Brazil business paper reports that Bunge's S American arm will invest in
a crushing plant for soyoil/biodiesel production.  The paper said the
facility will be operation in late 2008.

-- CBOT Soybean Complex Deliveries

Soybeans                      1,469

Soybean Meal                 406

Soybean Oil                     30

-- Brazil's CONAB revised its 06/07 soy crop to 58.4 mln mt from July's
estimate of 58.0 mln mt.  Corn harvest estimate was unchanged at 50.6 mln mt
unchanged from the prior month

-- Dalian Soybean futures higher; soymeal & soyoil both higher also.

-- Malaysian Palm futures higher, up 22 ringgit after 3 days of declines.

-- Cargo analysts, SGS & Intertek, release July Malyasian palm export
volumes for Aug 1-10 on Friday.  Malaysian palm board releases stocks &
production figures of palm oil on Friday

-- Triggered buy stops and a mix of good fund buying aided to the higher
Soybean close on Tuesday.

-- eCBOT Vol. 56,349; Pit Vol. 21,324; Open Interest Change: +595

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

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

Cash Markets

--CIF Soybeans weaker off 2-9. Aug. +?? to +10, Sept. +3 to +16, Oct. +18 to
+25, Nov. +30 to +35, Dec. +20 to +28,  Jan. +28 to +34



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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