Linn Group Morning Corn Comment

CHICAGO - Nov 9/07 - SNS -- Following is the morning corn futures comment from the futures commission brokerage firm Linn Group.

The corn market closed higher today on spec buying in front of the USDA
report to be released Friday morning at 7:30 CST.  Weekly export sales were
good this morning and that helped support the market even if almost every
grain trader was watching the crude and gold market as much as the corn
market.  There seemed to be general buying across most of the commodity
markets today.  The crude market was lower today but it seemed to have
little affect on the corn market for once this week.  Traders also pointed
to corn/wheat spreading as helping support the corn market as there seemed
to be massive liquidation today in front of the USDA report.  One trader
said it seemed like traders that were short corn were trimming their
positions.  Volume was light/moderate and funds were buyers of close to
5,000 contracts.  Traders also said that weather in So. America will move to
the forefront now that US harvest is almost 100% completed.

eCBOT market was a little lower overnight with the December contract closing
down 2 cents.  The overnight market had some spreading and some final
position squaring before the USDA report this morning.  USDA lowered its
crop production estimate for November to 13.168 bil bu vs. estimates of
13.261 and a yield of 153.0 vs. estimate of 154.1.  There was no change in
estimated harvested acres and on the S&D report, the USDA lowered feed
another 50 mil bu.  At first glance, these numbers may seem bullish, but
remember, corn has rallied 12 cents the last 4-5 days on the expectation of
lower yields.  Is today another case of buy the rumor, sell the fact?  It
seems like most of the people I talk to this morning after the release of
the USDA report starts out calling corn higher, but doesn't think it can
hold.  Technically, corn made new highs yesterday, but now you need the corn
market to hold those highs or it could turn very negative.  Initially, the
calls are 3-5 higher, but I wouldn't be surprised if the corn market opens
unchanged.   Investment funds could be the difference in the corn market
today with one big investment firm telling us today that they are looking to
buy corn.  Don't forget about the outside markets.  Gold and crude are lower
overnight/early this morning, but are now creeping back higher with crude
unchanged, $1.00 off the lows.

eCBOT Overnight

Contract            Last      Net Change       High      Low

ZCZ7                 387^4    -2^0                  389^4    387^4

ZCH8                404^2    -2^0                  406^0    404^2

ZCK8                415^4    -0^6                  416^2    414^4

ZCN8                423^2    -2^4                  425^0    423^2

Post Report Opening Calls: unchanged to 3 higher

Top News

**US Nov Corn 07/08 Crop Prod: 13.168 bln bu.; est. 13.26 bln bu.; Oct Rpt
13.318

**US Nov Corn 07/08 Yield: 153.0 bu/ac; est. 154.1 bu/ac; Oct Rpt 154.7
bu/ac

**US Nov Corn 07/08 Carryout: 1.897 bln bu. ; est. 1.93; Oct Rpt 1.997

-- German corn harvest 95% complete, newest estimates by private analysts
peg the crop nearly +6% higher than current government estimates - 3.7 mil
tons total anticipated

-- Dalian Corn futures settled modestly higher +7 Yuan/mt at 1774 Yuan/mt
basis the active May futures

-- eCBOT Corn Vol: 162,047; Pit Vol.: 64,068; Open Interest change: -4,756

-- Weather: 6-10 Day Forecast: Normal to Below Temps. Normal to Below
Precip. The Corn Belt looks dry today and Saturday.

-- Outside markets. Energy: crude off 42c at $95.04/bbl; products follow
lower ; Gold & Silver: both lower; US $ down slightly vs. Euro Dec futures,
off 94 vs. Yen Dec futures

Cash Markets

--CIF Corn steady . Nov. +57 to +58, LH Nov. +58 to +60, Dec. +60 to +62,
Jan. +50 to +52, Feb. +49 to +52, Mar. +50 to +52, A/M +40 to +43

TREND:

Crop report in the AM. The trade today certainly points to the trade feeling
there will be a bullish corn estimate surface. There is not much in the
report for US wheat. S&D's already as tight as they can get. Only thing
would be a reduction in exports? World situation does not feel quite as
tight---even with the effort of other exporters to control supply?

Note the rally in futures will tend to slow the export demand for next week
just as it steps up farmer selling. Will start to show in corn first. Bean
trade seems to be inelastic or at least the soyoil share of that trade?



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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