Alaron Grains and Oilseeds Comment

CHICAGO - Jul 15/08 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

Monday's weekly export inspection report showed 24.1 million bushels of corn was inspected for near term export; down from 37.6 the week prior, our four week average of average of 36.2 and 43.1 a year ago.   It clearly suggests a near term slow down in demand even with prices down 1.10 from recent highs.   In part, importers await some direction after Friday's USDA crop report.   Monday's 3:00p crop condition report showed 64% of the crop was in good to excellent condition up 2% from the week prior, up for the fifth consecutive week and equal a year ago.   13% is in its silking stage.   Sunshine and timely rain has brought corn back from the June 16^th report that was 57% G-E and 13% behind a year ago.   This week's weather looks to further improve quality.   The weather is very uncertain for Sunday through next week as of today.   WXRISK.COM   sees the upper plains, northern Iowa, northern Illinois, Minnesota and Wisconsin with 2 to 4 inches of rain Thursday and Friday and another 2 to 3 Sunday and Monday on several of the weather prediction models.   Other models have no rain Sunday and Monday and expand this week's heat dome for Missouri, Illinois, Indiana and Ohio through next week as well.   The weather for next week will become clearer Wednesday and Thursday.  Right now, the Thursday through Monday portion of 5 to 7 inches total would cause low lands to pond again and the dry eastern belt is too dry for too long to help crops.   After a higher opening on weather concerns the Federal Reserve meeting began seeing crude oil go from up one dollar to down 8 dollars pulling corn from up 9 to down 20 cents as funds took long profits across the trading board on fear something negative would arise from discussions.   December futures held the major support at 7.60 but a close under here this week sets up a test of 6.45 then 6.10.   We need a close over 6.90 to turn technically strong.

Monday's weekly export inspection report showed 5.7 m.b. of beans were inspected for near term export, down from 10.4 the week prior, 12.5 on our four week average, and 11.4 a year ago.   Like corn, beans too see a slower near term demand even as we are 70 cents off recent highs.   Key has been Argentine farmers have yet decided whether to strike after recent government decisions to maintain a large grain export tax.   Monday's 3:00p Crop Progress Report put beans condition at 59% in G-E condition unchanged from the week prior, up 3% from June 16^th but 3% behind a year ago.   A little sluggish on improvement considering the good weather; traders had expected better.   Beans opened 18 cents higher on the open from the unchanged condition report and talk of this week's heat dome extending into next week but it quickly turned down 40 cents at one point when crude oil broke hard pulling most markets with it as Congressional talks began on open T.V. and funds left the water until the sharks were done.   I did not like the close under support basis November as it suggests next stop is 14.75.   The close was just under it and Wednesday's weather updates and outside markets prior the open will give better confirmation as to further profit taking lows or is a low in near term.

Monday's weekly export inspection report showed 11.9 m.b. of wheat was inspected for near term export, off from 19.9 the week prior, 14.1 a year ago and four week average of 16 m.b.   It suggests a slight slow down in near term demand but I am sure it is temporary on the week as the U.S. end users and foreign end users all need wheat.   The afternoon crop condition report shoed 61% of our spring wheat is in good to excellent condition, down from 69 the week prior, the lowest rating since June 2^nd and under a year ago of 76%.   We are down 13% in the G-E category the last two weeks as the key headed stage now at 84% has unveiled poorer conditions.   It suggests a slight slow down in near term demand but I am sure it is temporary on the week as the U.S. end users and foreign end users all need wheat.   The afternoon crop condition report showed 61% of our spring wheat is in good to excellent condition, down from 69 the week prior, the lowest rating since June 2^nd and under a year ago of 76%.   We are down 13% in the g-E category the last two weeks as the key headed stage now at 84% has unveiled poorer conditions.   It always takes the head to be developed to show a problem, now we are there. The bullish crop condition report pushed wheat up 10 cents on the opening before we pulled to down 10 cents in sympathy with other grains on talks in Washington over recent economic woes.   September Minneapolis wheat closed right on technical support.   A lower close Wednesday and 8.50 is next support.   September C.B.T. settled on support as well.   A close under and 7.75 is next key support.

End.

Tim Hannagan

Alaron Research Team

800.563.9510

thannagan@alaron.com

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