Linn Group Morning Corn Comment

CHICAGO - May 1/09 - SNS -- Following is the morning corn futures comment from the futures commission brokerage firm Linn Group.

The corn market closed higher on Thursday as the wet weather and continued
good export sales helped push the corn market higher.  The July and December
contracts closed up about 2 cents.  Corn also gained some momentum from the
soybeans which once again were higher as soybeans are in a demand squeeze
out of Argentina and the talk of China canceling bean cargoes now seems to
be just rumors and not true.  The weather remains the main feature for the
corn belt as many fields are wet and rains continue to come across parts of
the Midwest this weekend and the beginning of the week, thus pushing back
planting and possibly forcing farmers to switch to beans the later it gets
in the planting season.  The WCB has about 50% or more of their corn
planted, but now there is talk that maybe it was planted too early as the
weather has switched to cool and wet and the corn may have trouble
germinating.  I don't think the market is real worried yet because the
genetics are a lot better, but the market is talking about it.  The outside
markets were a mixed bag with the Dow and crude about unchanged and the US$
slightly higher.  The volume was good yesterday at about 270,000 contracts
and funds were buyers of 8,000 contracts.

Overnight, the corn market closed slightly higher on a relatively quiet
night with only a 4 cent trading range.  Nothing new in the market this
morning and the outside markets will be a little supportive with crude
higher and the Dow and US$ about unchanged.  There is continued talk that
countries are looking for corn, but there wasn't any announcements out of
the USDA.  The weather forecast this morning still has rains coming into the
Midwest this weekend and the beginning of the week before it clears out and
some field work will get done.  We will get planting progress on Monday
afternoon, but we don't expect to see much work getting done last week or
this weekend, so it should be a lost week.  The big question looms on
whether we are going to see farmers switch from corn to beans or are they
going to wait out the rains and plant corn.  For many farmers, the decision
is a lot harder this year because the price of corn isn't where it was last
year when it was a no brainer to wait and plant corn.  Much of the area that
hasn't seen any planting, central IL and IN, are big corn areas, so they
will be late to switch, but some of the fringe areas, 150 bu average, may
switch earlier than expected.  The corn market should be slightly higher on
the opening and then look for direction.  The front month soybean close
today is very important as we need to close through the resistance to extend
the gains, so if that happens, corn will follow, if it fails, corn will sell
off with it.

 Globex Overnight

Contract            Last      Net Change       High      Low      Volume

ZCK9                396^4    0^2                   397^0    394^2    191

ZCN9                405^4    2^0                   405^4    401^2    3742

ZCU9                412^6    0^2                   414^0    410^4    342

ZCZ9                 425^2    2^0                   425^2    421^0    972

Early Opening Calls: 2-3 cents better

Top News

-- EIA reports February ethanol production at 761 million gallons for the
month, implying corn usage at 272 million bushels.  They estimate daily
ethanol production for Feb at 27.2 mil gal/day, an increase of 5% over
January's daily rate - higher than forecasted.  Data shows Ethanol carryout
increased to nearly 660 million gallons, a 10.5% increase from January.

-- EIA: Ethanol imports fall to three year low at only 2 million gallons for
the month of February

-- 331 confirmed cases of the Influenza A according to WHO data, spread over
10 countries worldwide, with 10 confirmed deaths due to the flu

-- Pig farmers are taking every precaution to prevent the H1N1 virus from
spreading from humans to pigs, banning visitors, maintenance workers or any
type of stranger from sow barns, says the National Pork Producers head
veterinarian

-- Dalian Commodity Exchange is closed Friday, May 1 for Labour Day. It will
reopen Monday, May 4

-- Liffe Commodity Exchange is closed Friday, May 1 for Labour Day. It will
reopen Monday, May 4

-- Globex Corn Vol: 244,307; Pit Vol.: 22,487; Open Interest change: -
13,556

-- Weather:

-- Outside markets: Energy Complex +0.26 at $51.35; Gold & Silver: -5.5 at
$883.4 & -0.112; US $ is better vs. Euro & Yen.

Cash Markets

            Bean Barge       Corn Barge        SRW Barge       HRW Track
Ill Riv Frt

May      +65/70 N           +44/47 K           -28/-22 K           +??/87 K
250

Jun       +61/65 N           +40/42 N           -25/-22 +           ??/87 N
255

Jly        +61/65 N           +43/45 N           -22/-20 N           + 70/80
N          270

Truck    Beans   Corn     Wheat   Meal     Hi-pro Oil

Chicago -4 K     +9 K     -80 K

Toledo   +2 N     -2 K      -95 K

Dec ILL +18 N   +10 K               +7 K     -300 K

TREND:

Corn is looking at a good close on the weekly chart if we can hold together
into the close on Friday. Counts on CK were to 5.25 but counts on CN look
like the upside could make a challenge of 4.95 to 5.00

Also have to move away from bearish attitudes in wheat---only due to the
fact that bean complex can float all prices higher. There is also the fact
that the US wheat offers are not looking all that far out of the levels
trading now?



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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