Alaron Grains and Oilseeds Comment

CHICAGO - Aug 1/08 - SNS -- Following is the grain and oilseed futures comment from Alaron Trading Corp.

Thursday's weekly export sales report showed old crop sales before September 1^st delivery were 63 t.m.t. but new crop year delivery sales after September 1^st were 825 t.m.t.   This is a very strong number and shows importers are getting loaded up on inventory for the New Year and this explains why the December 09^th contract has gained on the December 08^th contract this week.   We should expect the December 2009 contract to continue to gain on the spread vs. 2008 December contract as ending stocks for 2009 are expected to be half of 2008 .   Another battle against beans in the January to March time frame to find a price high enough to insure we plant more corn acres and at least not lose any.   This was simple week.   We rallied     Monday to Thursday, on daily news the heat dome was coming into the Midwest grain belt but late Thursday and Friday prices fell as forecasters build rain into next week and the heat dome moving out.   If we come in Monday and see the Wednesday to Friday rain called for, expect a lower trade Monday but get ready to buy our Monday and or Tuesday low as some weather gurus see the heat dome returning in the 11 day out forecast and traders will want to be long late week ahead of the August 12^th USDA final grain planted acres report.

Thursday's weekly export sales report showed 271 t.m.t. of beans were sold last week, up 48% from the week prior with key world buyer China in for 134 t.m.t. vs. zero the two prior weeks.   The China buy was a little bit of a surprise in the market.   Additionally, new crop year sales after September 1^st were 436 t.m.t. as you know the U.S. becomes the primary port of origin to buy beans from in the world as South American crop sales seasonally are largely over with another big U.S. crop coming to harvest in September and October.     Like corn, beans too enjoyed a nice early week rally into Thursday's opening before a weather change for next week sent prices falling into Friday's close.   Our goal is to buy the week's low which will come sometime between Monday and Tuesday opening, as we look for a late week rally into the August 12^th acreage report- where the fear is the flooding in early June stole acres away.

Thursday's weekly export sales report showed 726 t.m.t. of wheat was sold last week up 19% from the week prior and 10% over our four week average.   Another good example of our strong demand was in as importers and end users with empty bins from last year move in to replenish stocks and meet immediate needs.   With our spring wheat harvest just beginning, and progressing through August end, we look for demand to continue strong.   However, not a market moving fundamental as supplies here and overseas are ample.   Wheat's strength this week was all mechanical.   September CBT wheat was sitting on a major support area.   Late week saw traders unwind their long corn, short wheat spreads and the commercial grain traders short 122 thousand contracts bought some back suggesting they believe a near term low is in September CBT wheat has major support at 8.55, sell short under that price or buy a close over 8.00.

End-

Tim Hannagan

Alaron Research Team

800.563.9510

thannagan@alaron.com

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