Linn Group Morning Corn Comment

CHICAGO - Apr 1/08 - SNS -- Following is the morning corn futures comment from the futures commission brokerage firm Linn Group.

The corn market got the report we thought they were going to get with a much
lower acreage number and they got a bullish surprise with a lower stocks
number.  The problem is the USDA report for soybeans and wheat were very
bearish and they dragged the whole grain complex down as beans, bean oil,
meal, and wheat closed limit down.  The corn market traded over 25 cents
higher at a one point early in the session, but it just could hold with the
other markets down so hard.  Corn sold off late in the day but recovered on
the close to actually close higher with buying coming into the market the
last 2 min.  The USDA release their acreage estimate of 86.0 mil acres vs.
the average estimate of 87.3 mil acres.  This was down 8% from last years
planted acres of 93.6 mil acres which even with the big decline, it is still
2nd largest planted acres since 1944.  The stocks number was lower than
expected as well and surprised the market as this number is pretty solid and
not a "guess" on acres planted.  Volume was huge on Monday, over 350,000
contracts and funds were buyers of 14,000+ contracts by the end of the
session.

Overnight, the corn market closed lower after bouncing around unchanged for
most of the night session.  The May, July, and December contracts all closed
a couple lower as they were led lower by a continued sell off in the rest of
the grains and outside markets.  The metals and energies are all much lower
this morning and the US$ is stronger which will help push the grain markets
lower.  The general consensus is that corn prices will need to go higher to
buy more corn acres because 86 mil acres just isn't enough acres with the
demand for corn for feed, ethanol, and exports not decreasing.  The hog and
pig report on Friday showed that the feed demand will remain strong, ethanol
production was up in the 1st quarter and exports are almost twice as much as
last year in the 1st quarter.  The USDA data tells you that corn prices
should go higher and they need to buy acres, but with beans selling off
hard, it will be hard to rally corn.  We look for the corn market to open
lower on the opening and then look for direction.  If the soybean markets
continue to sell off, it will be hard to rally the corn market.  Outside
markets selling off, so that will add pressure to the grains.

Globex Overnight

Contract            Last      Net Change       High      Low

ZCK8                565^6    -1^4                  572^6    564^0

ZCN8                578^6    -3^2                  585^4    577^0

ZCU8                583^2    -1^2                  588^0    579^4

ZCZ8                 579^0    -2^0                  586^6    576^6

ZCH9                587^0    -2^6                  593^0    585^0

Early Opening Calls: 2-4 cents down

Top News

**USDA Weekly Corn Inspections: 42.538 mln bu; expected 39.0 mln bu

-- Texas corn crop was 47% planted, below last year's pace of 55% planted &
behind the long term average of 51%.  23% of the corn crop has emerged vs.
the 41% pace year ago & the long term avg of 31% emerged.  Corn conditions
were 50% good-excellent; 38% fair; 12% vp-poor.

-- Missouri Corn planting progress was minimal. Franklin County reported a
few planters on sandy fields, while the Bootheel reports only 1 percent
planted compared with 45 percent last year.

-- Excessive rainfall in Arkansas during March has delayed planting of
crops. Arkansas producers have planted only 24 percent of the corn crop and
1 percent of the sorghum crop.  The majority of these plantings were in the
southeastern corner of the state.  Both corn and sorghum plantings are well
behind the 2007 crops and the 5-year averages.

-- Louisiana corn was 87% planted well ahead of last week's 43%, ahead of
87% seen a year ago & long term avg of 61%.  Corn emerged was pegged at 14%,
behind last year's 46% pace and of the long term avg of 23%

-- Georgia Corn was rate 1% vp-poor; 29% fair; 70% good-excellent. 40% of
the Corn crop has been planted, up from 19% last week, but behind last
year's pace of 58%.  14% of Georgia Corn crop has emerged vs. the 26% last
year.

-- Corn import duties have been eliminated by the Indian gov't in an effort
to combat food price inflation, effective immediately acc. to the country's
finance minister

-- Sept Dalian Corn futures settled the session 22 Yuan lower at 1,768
Yuan/mt on volume of 1.67 mln contracts

-- Globex Corn Vol: 316,924; Pit Vol.: 58,882; Open Interest change: -1,643

-- Outside markets: Energy Complex -0.70 at $100.88; Gold & Silver: -18.4 at
$898.0 & -0.392 at $16.883; US $ is slightly higher vs. Yen & Euro

Cash Markets

            Bean Barge       Corn Barge        SRW Barge       HRW Track
Ill Riv Frt

Mch      +10/20 K           +50/55 K           +25/35 K          +??/90 K
450

Apr       +5/15 K             +44/46 K           +20/35 K          +75/90 K
445

May      +10/20 K           +43/45 K           -85/-70 N          +80/  K
400

Jun/Jly  +15/25 N           +40/42 N           -100/-90 N         +70/   N
425

Truck                Beans   Corn     Wheat   Meal Hi-pro        Oil

Chicago                       -62 K    -12 K   -50 K

Toledo              -58 K    -20 K   -50 K

Dec ILL            -40 K    -10 K                -13 K              -275 K

TREND:

Corn traded to 6.00 in both the Jly and the Dec today providing one more
bench mark. Corn will have a hard time combating the weakness in wheat and
beans and may spend some time at these levels. The tightening stocks caused
spreads to tighten some today. Thought it might affect basis levels as well
but it has not. Next upside count in CK is 6.30. Weekly charts also have
problems at 6.20 to 6.30. Only weather to take the market through this level
during the summer?



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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