Linn Group Morning Soybean Comment

CHICAGO - Aug 10/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Thursday’s trading session in Soybeans ended a narrow range session down ¼
of a cent. Traders squaring up their position prior to today’s USDA crop
report kept the market from making any big moves. Traders say he market was
supported by strength in meal and concerns that heat and dryness in the
southern Midwest was cutting yields. The meal market is getting a boost from
Europe traders say. Talk of European farmers being forced to feed more
soybean meal because meal is relatively cheap compared to wheat prices has
been supportive. Volume on Thursday was light with 82,602 soybeans traded,
43,971 meal and 33,663 oil traded. Funds sold an estimated 1,000 soybeans,
2,000 oil and bought 1,500 meal.

Today the USDA released their crop production report today. USDA left its
2007 U.S. soybean production estimate unchanged at 2.625 billion bushels and
ending stocks of 51.63 mmt. Yields were estimated at 41.5 bpa.  Today’s
focus will begin with reaction to the USDA report but other factors such as
world financial markets in turmoil, continued concerns of hedge fund
problems and talk about credit liquidity could effect fund trade in all
markets. China’s custom officials report China imported 3.03 mmt of Soybeans
in July vs. 2.52 last year. Chinese crushers say they are likely to import
more soybeans after reports of low arrivals in August. Overnight Malaysian
palm oil futures closed lower. Chinese Soybeans and meal closed higher. Oil
lower.

Post Report Opening Calls: 5 to 7c higher; soymeal $1 higher; soyoil steady
to 10c higher

Top News

**August China 07/08 Soybean Output: 15.2 mmt; July Rpt 15.6

**August Brazil 07/08 Soybean Output: 61.0  mmt; July Rpt 61.0

**August Argentina 07/08 Soybean Output:  mmt;47.0 July Rpt 47.0

**US August Soybean 06/07 Carryout: .575 bln bu. ; est. 0.59; July Rpt 0.600

**US August Soybean 07/08 Carryout: .220 bln bu. ; est. 0.25; July Rpt 0.245

**US August Soybean 07/08 Crop Prod: 2.625 bln bu.; est. 2.65 bln bu. July
Rpt 2.625

**US August Soybean 07/08 Yield: 41.5 bu/ac; est. 41.9 bu/ac; July Rpt 41.5
bu/ac

**World 07/08 Soybeans Carryout: 51.63 mmt; July Rpt 51.8

**World 07/08 Soymeal Carryout: 5.38 mmt; July Rpt 5.42

**World 07/08 Soyoil Carryout: 2.42 mmt; July Rpt 2.34

-- China’s Ag Ministry released a statement that said grains lost to drought
were already above normal so far this year.

-- Dalian Soybean futures higher in overnight trade as soymeal makes gain
too.  Soyoil futures were lower 32 yuan in Jan 08 contract.

-- Malaysian Palm futures saw light volume and was lower overnight by -0.8%

-- Aug 1-10 palm oil exports rose 20% vs same period in July.  374,913 mt of
palm oil had been exported acc. to SGS.

-- Intertek reports that Malaysian palm oil exports rose 15.2% to 378,014 mt
in the first 10 days of Aug. when compared to same period in July

-- July exports of palm oil rose to 1.1 mln mt, up 16% from the prior month.
Crude palm oil production rose 16% in july from June & stocks had also risen
9% during the month, acc. to Malaysian Palm Oil Board

-- Poll of oilseed market watchers estimates palm oil stocks at end of July
up 3.9%; palm exports during July up 15.5% from June, production during July
12% higher, according to a survey by reuters

-- Soybean Complex Deliveries

Soybeans                      498

Soymeal                                   171

Soyoil                           417

-- Funds sold 1,000 Soybeans, 2,000 Oil and bought 1,500 Meal.

-- eCBOT Vol. 53,346; Pit Vol. 24,215; Open Interest Change: -1,486

-- Weather: Above Normal Temps. Below Normal Precip. Most of the  eastern
and central Corn Belt will be dry today into Monday.

-- Outside markets. Energy: crude 84c lower, products lower ; Gold $2 lower
& Silver 5 1/2c lower ; US $ higher vs Euro, lower vs Yen.

Cash Markets

--CIF Soybeans steady firm . Aug. +2 to +6, Sept. +5 to +15, Oct. +18 to
+25, Nov. +25 to +35, Dec. +17 to +28,  Jan. +20 to +30



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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