Linn Group Morning Corn Comment

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

The corn market was higher on Wednesday as we saw stronger outside markets
and a stronger grain complex.  The whole grain complex opened lower after
the release of the quarterly stocks report before the opening, but it
quickly recovered the losses.  Corn closed up about 3 cents on late day fund
buying, but that was about 9 cents off the lows made early in the session.
Soybeans and wheat were both about 10 cents higher recovering off the early
session lows and that helped pull corn higher.  The outside markets were
also supportive as crude oil recovered a lot of the losses from the last
couple of days closing up almost $4.  The corn market has seemed to diverge
from the energy markets the last couple of weeks, but you can't deny the
connection because of ethanol.  It was the end of the month and quarter
yesterday, so some traders speculated that we saw position squaring and new
money coming into the commodity markets.  The weather picture remains
probably a little supportive as we are going to see cool/wet weather across
most of the Midwest for at least the next week or so which is not helping
maturation.  The yields we are hearing about are good to very good, but that
is early planted corn.  The volume was on the light side again yesterday at
only 136,000 and funds were buyers of app. 3,000+ contracts.

Overnight, the corn market was lower early but closed just slightly lower.
The DB fund announced after the close on how it would react to the CFTC
ruling about position limits and that may have caused some of the early
selling pressure, but when you look at the details, they don't have to sell
a lot of contracts.  It is the psychological effect more than anything.
Weekly export sales this morning were better than the estimates.  The
estimate was for 650-850K and actual sales were 1.22 mil with the majority
going to Japan.  This should be some positive news for the corn market, but
I don't know if it will provide the spark that will push corn into new
highs.  Technically, corn looks strong, but the market is still expecting a
big crop.  The key will be if the late maturing corn produces and we
probably won't know the answer to that question until we see combines
rolling over the next couple of weeks.  The outside markets are a mixed bag
today with crude higher, but the US$ also higher.  FC Stone came out with
their estimates yesterday afternoon at 163.3 for production of 13.064 and
USDA demand at 13.025 which would keep stocks tight enough to prevent
aggressive selling???  Corn will be called unchanged, slightly higher today
with the good export sales and then corn will try and make a good trade and
take out the recent highs and close above those highs.  That is the key for
the next 2 days.

Globex Overnight

Contract            Last      Net Change       High      Low      Volume

ZCZ9                 343^0    -1^0                  343^4    338^2    6254

ZCH10              356^0    -0^6                  356^0    351^2    1368

ZCK10              364^2    -1^4                  364^2    360^4    48

ZCN10              372^4    -1^2                  372^4    368^0    248

Early Opening Calls: off 1-2 cents

Top News

**USDA Corn 09/10 Export Sales Net: 1.223 mln mt; 10/11 Net: NONE mt;
expected 650k-850k mt

-- US Corn crop is estimated at 13.064 bln bu., while the crop's yield is
163.3 bu/ac, acc. to forecast by commodity broker FCStone.  The group's
previous estimate was 13.02 bln bu. & Aug USDA estimate was 12.96.

-- Deutsche Bank announced major changes today to their two major commodity
index funds, the PowerShares DB Commodity Index Tracking Fund and
PowerShares DB Agriculture Fund.  Agriculture-only fund, DBA, will
liquidate half of their positions in

corn, wheat, and sugar, and they will shift those funds to cocoa, coffee,
and livestock.  While the diversified fund, DBC, will sell an unspecified
amount from corn, wheat, sugar, and NYMEX Crude, and transfer it into Brent
Crude, live cattle, coffee, RBOB gasoline, cocoa, natural gas, and copper.
Changes are expected to occur from now until October 19th - the

DBA fund has $2.2 bil assets under mgmt, and the DBC fund has $3.3 bil
assets under mgmt.

-- Buenos Aires Grain Exchange report on Wednesday suggests the local Corn &
Wheat crops have been helped by recent precip events in many growing areas.

-- Buenos Aires Grain Exchange pegs Corn planting in Argentina at 1.88 mln
ha, that would be the smallest amount since 1989.

-- Pending Tender: Corn miller group in Taiwan is seeking between 56,000 and
60,000 mt of US or Brazilian grain in a tender scheduled for Friday.
Shipment is for December, acc. to traders

-- Liffe Nov corn futures were +0.50 euro better at 120.50 euros/mt.

-- Dalian Commodity Exchange will be closed Oct 1-8 for the National Day and
Mid-Autumn Festival Holiday. Trading will resume on October 9th

-- Globex Corn Vol: 120,209; Pit Vol.: 9,474; Open Interest change: + 2,143

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

-- Outside markets: Energy Complex -0.54 at $70.07; Gold & Silver: -2.8 at
$1006.5 & +0.017 at $16.675; US $ +0.365 at $77.225

Cash Markets

-- CIF Corn steady off 3 . Sept. +57 to +60, Oct. +54 to +55, Nov. +54 to
+55, Dec. +56 to +58, Jan. +48 to +51, Feb. +48 to +51 ,Mar. +48 to +51,
April +45 to +47



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/

DISCLAIMER: Futures and options trading involve substantial risk. The valuation of futures and options may fluctuate, and as a result, clients may lose more then their original investment. In no event should the content of this website be construed as an express of an implied promise, guarantee or implication by of from the Linn Group, Inc. that you will profit or that losses can or will be limited in any manner whatsoever. Past performance is not necessarily indicative of future results. Information provided on this website is intended solely for informative purposes and is obtained from sources believed to be reliable. Information is in no way guaranteed. No guarantee of any kind is implied or possible where projections of future conditions are attempted.

Information on this page is derived from third parties and is deemed to be reliable. STAT Communications Ltd. accepts no responsibility for errors, omissions or inaccuracies in any of the material presented on this web site. Opinions expressed on this web site are those of the respective individuals and/or institutions and do not represent the opinions of STAT Communications Ltd. or its management.