Linn Group Morning Corn Comment

CHICAGO - Oct 11/07 - SNS -- Following is the morning corn futures comment from the futures commission brokerage firm Linn Group.

The corn market closed higher on Wednesday on the back of the rally in the
soy complex and short covering in front of the USDA report that will be
released tomorrow morning before the opening.  The December contract closed
almost 5 higher on a 4 cent trading range and very light volume with funds
buying 5,000+ contracts by the end of the day.  Harvest weather continues to
be very good and cash traders report very little farmer selling as much of
the corn is going to fill old contracts and a lot of corn is being stored on
the farm.  This harvest pressure is helping to keep corn prices from really
rallying and we actually see different traders willing to sell rally's in
corn.  We continue to hear talk of the USDA slashing the estimated 2007
harvested bean acres.  Traders also said we are seeing specs and funds
squaring some positions in front of the USDA report tomorrow, but for the
most part, corn is going to grind around until we get the USDA report.
Technicals remain weak for the corn market.

eCBOT market was higher overnight as traders continue to square positions in
front of the USDA report tomorrow morning and a stronger wheat market.
Weekly export sales are also delayed until tomorrow morning because of the
holiday on Monday.  Very little new news out about corn right now and it is
following the other grain markets when looking for direction.  A higher corn
market was also helped overnight by other commodity markets trading higher
(gold, crude) and a weaker US dollar.  The market seems to be looking for a
very bearish number tomorrow in either a change in estimated yield or an
increase in estimated harvested acres.  I think the market will open higher
and try to rally, but it will me with active selling on traders trying to
position themselves for a negative number tomorrow.  We will also see some
traders squaring positions to reduce their exposure to a surprise number.
The surprise tomorrow would be the USDA leaving much of its September
numbers the same, but do you really think the corn market is going to trade
higher even with a bullish number?  November options expire tomorrow, so
that could be a cheap way to try and play the USDA report. We look for a
quiet day today unless the beans push a the market higher and corn follows.

eCBOT Overnight

Contract            Last      Net Change       High      Low

ZCZ7                 349^4    2^2                   349^6    346^2

ZCH8                366^0    1^6                   366^0    363^0

ZCK8                376^0    1^6                   376^0    373^2

ZCN8                385^0    1^6                   385^0    381^6

Early Opening Calls: 2 to 3c higher

Top News

-- USDA Weekly Export Sales data release delayed until Friday due to
Columbus Holiday on Monday

-- 100,000 mt of US Corn bought by Israeli feed group for Dec/Jan delivery.

-- Friday USDA releases latest monthly crop supply/demand & world ag
production figures. Analysts see corn production at 13.46 mln bu and a yield
of 157.7 bu/ac.  Carryout is estimated to be 1.959 bln bu.

-- Dalian Corn futures lower, active May contract off 6 Yuan/mt on 500,000+
contracts traded

-- eCBOT Vol: 61,534; Pit Vol.: 61,534; Open Interest change: +327

-- Weather: Above Normal Temps. Normal to Above Precip. Corn Belt will be
dry into Saturday.

-- Outside markets. Energy: crude up before storage report, products sharply
higher ; Gold $6.90 higher & Silver: 16c higher; US $ off against Euro,
slightly higher vs. Yen.

Cash Markets

--CIF Corn up 1 to 3 . Oct. +59 to +61, Nov. +63 to +66, Dec. +64 to +66,
Jan. +51 to +54 J/F/M +51 to +54

TREND:

Wheat has stalled on the break but still see small rallies in Chi as selling
opportunities. Do bear spreads in Chi and come back to KC/Chi on small
corrections

Corn still has a lot of harvest to come---rallies will have problems---high
today was 13 cents of the lows. Could be enough?



If you have any questions or want to discuss specific trade recommendations,
contact me directly.

Jim Riley
Linn Group
877-787-6278
jriley@linngroup.com
www.linngroup.com/

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