Linn Group Morning Soybean Comment

CHICAGO - Aug 21/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybeans closed ½ cent lower in the November contract on Monday. Traders
describe Monday’s action as a narrow range inside trading day recovering
from an early sell-off slowly climbing into the close. There was fund
liquidation after good rains over the weekend floor sources indicate.
Traders are still keeping an eye on the volatile Stock market and the
ongoing Sentinel saga. Reports this morning that The SEC on Monday accused
Sentinel of misappropriation of client assets which has been keeping all
markets on edge as this plays out. Volume on Monday was light with an
estimated 70,399 futures traded, 43,317 Oil and 23,601 meal traded. Funds on
Monday bought an estimated 500 meal, sold 1,000 oil and even in beans.

After the close on the USDA released the weekly crop conditions showing
Soybeans rated 54% good to excellent vs. 56% last week, 58% last year and
56% average. Setting pods 92% vs. 92 % last year and 88% average. Analysts
say the crop condition reports for beans were a bit surprising coming in
down 2% after expectations of unchanged to up 2%. Overnight soybeans ended
the night session up 5 ¾ cent % in reaction to these numbers. Early harvest
continues in the Southern parts of the Corn Belt. Reports are showing poor
yields and expectations are for much better yields as harvest starts to
progress to northern areas. Overnight Chinese Soybeans, meal and oil all
closed higher. Malaysian Palm oil futures closed higher.

Top News

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Soybean Progress & Conditions Mini-Recap

Soybeans % Setting Pods:  92%; 84% week ago; 92% yr ago week; 88% 5 yr avg.

Soybeans % Coloring:  2%; NA% week ago; 4% yr ago week; 2% 5 yr avg.

Soybean Crop Conditions Latest: VP= 6; P= 12; F= 28; G= 41; EX= 13

Soybean Crop Conditions Prior Wk: VP= 5; P= 11; F= 28; G= 44; EX= 12

Soybean Crop Conditions Yr Ago Wk: VP= 4; P= 11; F= 27; G= 44; EX= 14

=================

-- CropScout.com: Scouts move into Iowa, Ohio, & Nebraska Tuesday.  Over
1,000 yield tour images in Illinois already posted at www.CropScout.com!

-- Chinese central bank rose 1 yr lending rates to 7.02.% beginning
Wednesday, & the 1 yr depost rate was also raised to 3.6%.  This is the 4th
interest rate rise for that country since March of this year in an effort to
curb further inflation

-- Monday's USDA Soybean Inspections: 9.095 mln bu.; expected 4-12 mln bu,
previous = 3.83 mil bu

-- 12-16,000 mt of US soybeans sought by Taiwan Sugar crop in Wednesday
tender for shipment between Sep 22-Oct from US Gulf coast and Oct 7-21 from
the PNW acc. to traders

-- Arkansas State Univ researchers look to enzymes in corn germ to help
break down cellulosic feedstocks for ethanol production, according to a
researcher participating in the study.

-- Dalian Soybean futures 41 yuan higher in active May contract. Soymeal
higher in both active Jan & May, 39-54 yuan higher, soyoil Jan futures were
34 yuan lower.

-- Malaysian Palm rose 30 ringgit, about 1.3% on the day, but over
production concerns tempered the rise a bit, acc. to local analysts

-- eCBOT Vol. 49,549; Pit Vol. 18,448; Open Interest Change: +2,358

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

-- Outside markets: Energy complex: crude 36c lower, products slightly
lower; Gold 80c higher & Silver 1c; US $ lower vs Euro & Yen

Cash Markets

--CIF Soybeans  steady off 1. Aug. +20 to +27, FH Sept. +18 to +30, LH Sept.
+22 to +??, Oct. +30 to +35, Nov. +40 to +49,

Dec. +22 to +30, Jan. +27 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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