Linn Group Morning Corn Comment

CHICAGO - Jun 22/09 - SNS -- Following is the morning corn futures comment from the futures commission brokerage firm Linn Group.

Corn was lower on Friday as the market looked at the weather and the feed
industry and seeing no problem with ending stocks for the near future.  The
July and December contracts closed down about 4 cents, near the lows of the
day.  The soybeans were lower all day and made new lows near the end of the
day down about 30-35 cents which helped pull down corn.  The outside markets
were mixed on Friday with the US$ lower and crude also lower.  The US$ has
been a good indicator for grains, but maybe the grain markets are starting
to pay attention to technicals and fundamentals instead of following the
outside markets.  The crude oil helped push corn lower as it sold off and
closed   The technicals for corn turned negative about a week ago and only
got worse this week and with the close on Friday, now the market is seeing
weekly sell signals.  The weather forecast remains almost perfect for crop
development, especially for the late planted crops that are getting warm
weather and good rains.  Keep in mind that this crop is far from made, but
right now, we couldn't be getting better weather.  Informa came out with
acreage estimates which were inline with what the market was expecting and
we will see more analysts offering their acreage estimates this week.  The
volume was pretty good at 234,000 and funds were sellers of about 6,000
contracts.

Overnight, corn sold off early and late.  The July and December contracts
closed down about 10-11 cents after trading unchanged right on the opening,
but quickly trading lower.  Early in the session it was down 6-7 but in the
last 2-3 hours, it seemed to find some new selling to close near the lows of
the night session.  Nothing new to talk about this morning as near perfect
growing conditions across almost the whole Midwest is driving prices right
now.  Farmers will tell you that getting rain in June is exactly what the
doctor ordered and getting above normal temps is even better along with the
rain.  There are a few dry pockets, especially in parts of the WCB, but for
the most part, weather is near perfect and is supposed to stay that way for
next week or so.  The outside markets are all negative this morning and
probably helped push grains overnight, especially pushing them into new lows
the last 2 hours of the day.  The US$ is stronger this morning and crude is
weaker which should weigh on the markets as well as the weather.  Not too
much to talk about with corn right now as the rally that took 4-5 weeks,
disappeared in 7 days.  We talked about corn being dragged higher kicking
and screaming this spring because the feed margins are so bad and exports
are behind schedule, so this break in prices off the January highs,
shouldn't be a surprise, but that it happened all in 1 week probably
surprised the market especially with the June 30th crop report on the
horizon.  Corn will be called 10-12 lower this morning and we will see if it
finds any support.  Rally's will probably be sold aggressively.

eCBOT Overnight

Contract            Last      Net Change       High      Low      Volume

ZCN9                388^4    -10^6                 399^0    387^0    8002

ZCU9                395^6    -11^4                 407^6    395^0    2494

ZCZ9                 408^4    -11^0                 421^0    406^6    12013

ZCH10              418^6    -12^2                 432^0    418^6    732

Early Opening Calls: Corn 8-12c Lower

Top News

-- USDA weekly crop progress report this afternoon, analysts expect
unchanged to slightly better conditions

-- June 24 is the tender deadline set in a 15,000 mt feed Barley purchase
floated by group of Israeli millers.  They're seeking delivery of 10k mt in
late Aug to FH Sept with the balance in late Sept to FH Oct

-- Informa Economics estimates 2009 US national corn acreage at 83.1 million
acres, ahead of USDA report, acc. to trade sources

-- Friday's USDA Cattle On Feed Jun 1: 96%; expected 97%; prior month 97%

-- Friday's USDA Cattle Placements during Apr: 86%; expected 88%; prior
month 104%

-- Friday's USDA Cattle Marketings during Apr: 91%; expected 91%; prior
month 93%

-- CME announced June 5th that electronic trading hours for the CBOT grains,
oilseeds and ethanol contracts will be expanded in the morning by one hour
and fifteen minutes, until 7:15 a.m., beginning July 1.

-- CME Group to begin Latin American Commercial Incentive Program in August
to help rally reduced cost electronic trading for Latin American Ag Products
on the CME & CBOT.

-- Dalian Corn futures for Jan delivery settled at 1,627 Yuan/mt a drop of 6
Yuan from Friday's settlement; nearby Sep & Nov were higher 1 to 4 Yuan,
while other 2010 contracts were off 1 to 3 Yuan

-- eCBOT Corn Vol:  211,431; Pit Vol.: 15,679; Open Interest change: +10,038

-- Weather: 6-10 Day Forecast:  Above Normal Temps. Normal to Above Precip.

-- Outside markets. Energy: crude -$1.60, products lower, nat gas 5.8c
higher ; Gold off -$13, Silver off -38c ; US $ index higher, lower vs. Euro
& Pound, but better against Yen.

Cash Markets

-- CIF Corn  steady off 1. June +43 to +44, July +46 to +47, Aug. +44 to
+46, Sept. +49 to +51, Oct. +45 to +46, Nov. +47 to +48, Dec. +47 to +49,
Jan. +41 to +44

TREND:

The corn retracement came fast. Initial support at 4.00 on CN held up but
the reversals off the support were not able to build any major
gains---Welcome to Jun trading. Raining outside is bearish. Tops in for the
summer? Some say yes---but given a weather problem in Jly and the market
will come back to life---so this leaves us with a short term negative bias
but nervous about the way we trade later in the summer. If we take another
weak day or too below 4.00 it could signal a test of 3.70 Apr lows

Jly Wheat continues to chew lower in typical bearish wheat fashion. There
has not been much of a rally to sell into for the last $1.25 down. Market is
well down into support. Come away from the short side and let someone else
take the risk until we have a short covering rally

Estimates on Jun 1 stocks and acres will start to surface next week adding
to the Informa numbers. Acreage is a stab in the dark for all. The stocks
will have more relevance anyway ---stay tuned.



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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