Linn Group Morning Soybean Comment

CHICAGO - Nov 16/07 - SNS -- Following is the morning soybean futures comment from the futures commission brokerage firm Linn Group.

Soybeans took a breather on Thursday ending the session down ¾ of a cent.
However the market spent most of the day much lower and rallied a nickel in
the last 5 minutes. Global demand mainly from China continues to underpin
any breaks this market might give you. Volume was heavy with the CBOT
reporting 125,542 soybeans, 38,937 Meal and 68,591 Oil. Funds bought an
estimated 5,000 Soybeans, 3,000 Meal and sold 3,000 Oil

Early calls are higher. The USDA released export sales today (1 day late due
to Monday’s holiday). Soybean 07/08 exprot sales net 1.296 mil. mt. well
above estimates of 600,000 to 850,000. Meal sales came in at  153,200 Mt.
above expectations of 150,000 mt. Oil sales were 29,800 mt. well above
expectations of 5,000 to 15,000. The USDA reports private sale of 226,000 mt
US Soybeans sold to China for delivery in 2007/08. On top of huge purchases
announced the last several days. Analysts have speculated recently that
there are shortages of grains, pork edible oil and other foods. Officials in
Beijing however deny risks of shortages and say the main cause of price
rises is not supply shortages but cite demand and high prices as the cause.
Changes in consumption have also changed the environment there. Rumors are
now surfacing that Chins is buying Soybeans to place in reserve. Whatever
the reason it keeps a floor under this market traders say. Outside markets
should continue to effect commodity prices, Crude oil is trading $1.80
higher, US dollar is down .20 and Gold is $9.40 higher. Overnight Chinese
Soybeans and Oil closed lower, Meal higher. Malaysian Palm oil futures
closed lower.

Top News

*USDA reports private sale of 226,000 mt US Soybeans sold to China for
delivery in 2007/08

-- Strategie Grains:  Oilseed acreage estimates for 2008 held steady due to
gains in other crops - rapeseed down, sunseed up

-- Stepped up crushing operations in the Ukraine result in a sun oil
production increase of +79% to 195k tons in October, from September - 1.731
mil tons have been produced this year so far, acc. to government data

-- Chinese soy oil imports up +81% through October, rapeseed oil up from
next to nothing to 306k tons total, acc. to customs data

-- Malaysian palm oil exports declined -1.3% in the first half of November -
to 671k tons total, acc. to SGS

-- Customs data shows Indian veg oil imports up +6.7% so far this year
(through October) - cuts in taxes and import restrictions key in
acquisitions

-- Palm oil industry expert, Dorab Mistry, notes increased Chinese New Years
demand may raise palm oil prices to yet new peaks.

-- Barge traders talking about falling river levels and draft restrictions
that may come.

-- Dalian Soybean futures were 43 lower in May, 24 yuan/mt lower in Sept.
Soymeal futures were higher, May 21 yuan/mt at 3,527 on just over 1 mln
contracts traded in May. Soyoil off sharply -168 to 9498 yuan/mt.

-- Malaysian Palm oil futures follow crude & soyoil lower overnight down
0.7% to $863/mt

-- Intertek reported Nov 1-15 crude palm oil exports at 687,539 mt a rise of
2.4% from the same period in Oct.

-- SGS reported export shipments fell 1.3% to 670,772 in Nov 1-15 period vs
same period in Oct

-- eCBOT Soybean Vol. 97,637; Pit Vol. 24,809; Open Interest Change: -523

-- Weather: 6-10 Day Forecast: Below Normal Temps. Above Normal Precip. The
Corn Belt looks dry today into Monday.

-- Outside markets: Energy crude 90c higher at $94.33/bbl; Gold $7 higher &
Silver 15c higher; US $ lower vs Euro, unchanged vs Yen basis the Dec
futures

Cash Markets

--CIF Soybeans off 2 to 3. Nov. +27 to +32, Dec. +38 to +42, Jan. +45 to
+50, Feb. +37 to +40, Mar. +38 to +40, Apr. +35 to +40, May +35 to +40, J/J
+35 to +40.



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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