Linn Group Morning Soybean Comment

CHICAGO - Sep 19/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Beans took a breather on Tuesday gaining a penny after trading in a 13 1/2
cent range for the day. Recent price surges in beans has the market somewhat
overbought traders said and the market struggled to hold its price gains
throughout the session. The sell-off from the highs occurred in the first
few minutes and firmed into the close. Traders say that Tuesday was more of
a consolidation day than anything else. Oil ended .24 lower in the Oct.
contract after some profit taking after this weeks strong rally. Volume was
heavy once again with 124,911 soybeans traded, 48,813 soybean oil traded and
52,523 soybean meal traded. Funds were sellers on Tuesday selling an
estimated 2,500 oil, 1,000 soybeans and buyers of 2,000 meal.

Today's early opening calls are lower as traders indicate concerns for
continued technical selling as indicators show the market technically
overbought after reaching a three-year high this week. Pick up in harvest
also seen weighing on market. Supporting the market are worries about
planting conditions in Mato Grosso, Brazil, where its hot and dry. Reports
this morning of China providing aid to farmers planting oilseeds in an
effort to control rising food prices there. They agreed to offer subsidies
to farmers growing high-quality rapeseed as well as dairy farmers. A govt.
reserve system for soybeans and edible oils will be set up. Traders indicate
they look for soybeans to support in the November contract around the $9.50
area after making new contract highs 2 days ago. Soybean values at the port
of Rosario in Argentina hit record highs Tuesday with the nearby contract at
$239 per mt. A big drop in Palm oil prices in Malaysia overnight could
pressure the soybean oil market today. Overnight Chinese Soybean, meal and
oil futures all closed lower.

Early Opening Calls: 2 to 4c lower

Top News

-- Indonesia plans to remove a 10% tax on cooking oil to relieve price
pressure on the nation's consumers, acc. to a government source

-- High world soybean prices have increased estimated Brazil forward sales
of its 07/08 crop to 36% versus 6% seen last year in the same time period &
ahead of August 9%, according to crop analyst AgRural

-- AIG Analyst:  "Several billion more" dollars headed into commodity funds;
2Q 2007 commodity index investment pegged at $120 billion

-- Fed's FOMC lowers Fed Funds Target Rate 50 bps to 4.75% from 5.25%

-- Fed's FOMC lowers Discount Target Rate 50 bps to 5.75% from 6.25%

-- Dalian Soybean futures 43-45 yuan/mt lower in active May futures; soymeal
mixed, +13 in Jan, but -7 in very active May futures; soyoil lower

-- Malaysian Palm oil futures fell overnight as traders booked profit, Dec
futures 40 ringgit lower

-- The Brazilian real rose to 1.8730 after the Fed cuts rates, up 13.9% for
2007.

-- eCBOT Vol. 86,349; Pit Vol. 34,417; Open Interest Change: +2,694

-- Weather: Above Normal Temps. Above Normal Precip. The Corn Belt may see
some isolated light showers today.

-- Outside markets. Energy complex higher; Gold & Silver: higher; US $
slightly higher vs Euro & Yen

Cash Markets

--CIF Soybeans  steady up 3. Sept. +28 to +??, Oct. +33 to +40, Nov. +48 to
+52, Dec. +44 to +47, Jan. +47 to +52, Feb. +20 to ??, Mar. +33 to +38



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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