Linn Group Morning Corn Comment

CHICAGO - Sep 10/09 - SNS -- Following is the morning corn futures comment from the futures commission brokerage firm Linn Group.

The corn market closed higher on Wednesday in about the middle of the
trading range as we probably saw some short covering ahead of the USDA
report on Friday morning before the opening.  The December contact closed up
about 2 cents which was about 2 cents off the highs that were made earlier
in the session.  In a reversal, the corn traded higher most of the day and
soybeans traded lower.  The outside markets are also supportive with the US$
lower and the crude oil higher.  As mentioned yesterday, a private firm,
Lanworth, announced a 154 average yield, which is much below the average
estimate of 160+.  There remains very few reasons that corn should rally as
demand remains average at best and with the lower US$, traders were probably
jumping the gun on short covering and not waiting for Thursday.  The weather
remains a non-factor with the opportunity for frost/freeze not happening
until at least the 23rd and even then it looks like it will only be in the
far northern areas.  The volume was very weak at 106,000 contracts and funds
were light buyers of about 3,000 contracts.

Overnight, the corn market was higher again as we continued to see probable
short covering ahead of the USDA report.  With a range of about only 3 cents
overnight, the December closed slightly higher in about the middle of the
trading range.  The outside markets were pretty quiet with the US$, crude,
and the Dow were about all unchanged.  The market will look to the USDA
report tomorrow and we expect to see a pretty quiet day today with mostly
two sided trading and position squaring today.  There really isn't any new
news as traders/analysts try and estimate yields and look at the weather
forecasts.  Currently, the weather forecasts don't look to bring
frost/freeze weather into the heart of the Midwest/corn belt until the end
of the month or early October.   The corn market will be called slightly
higher on the opening and I expect it to close higher today on short
covering, but I don't expect to find anybody buying the market higher to put
on new longs.

Globex Overnight

Contract            Last      Net Change       High      Low      Volume

ZCU9                306^6    1^2                   308^0    305^0    39

ZCZ9                 310^6    1^0                   311^6    308^4    3009

ZCH10              324^4    1^2                   325^0    322^0    297

ZCK10              333^4    0^6                   333^4    331^2    28

ZCN10              341^6    0^4                   343^2    341^0    35

Early Opening Calls: 1-2 cents better

Top News

**Weekly USDA Export Sales data normally released on Thursday will be
released Friday, September 11, 2009, due to the Labor Day Holiday.

**USDA Reports private sale of 176,000 mt. of US Corn to South Korea for
09/10 marketing year

-- Collectively analysts are expecting Friday's USDA report to show a
national Corn yield of 161.4 bu/ac and output of 12.90 bln bu.

-- Analyst in a survey are expecting Friday's USDA report to show a national
Soybean yield of 42.36 bu/ac and output of 3.25 bln bu.

-- Ethanol consumption in Germany during the 1H of 2009 rose 61% from the
year ago period, acc. to industry group BDBE.  They note the government's
blending mandate helped boost consumption

-- There has been discussion of a next generation biofuel technique called
bio-syntrolysis, which would utilize 90% of the carbon in biomass, versus
35% yields in traditional cellulosic procedures - significant technical
barriers remain, but researchers estimate they can eventually produce "green
gasoline" for $2.50/gal

-- Trade sources suggest an Israeli firm may be investing in an ethanol mill
in Colombia

-- Ethanol consumption in Germany during the 1H of 2009 rose 61% from the
year ago period, acc. to industry group BDBE.  They note the government's
blending mandate helped boost consumption

-- Land purchased by VeraSun for a proposed ethanol plant near Granite City,
IL, will be auctioned off, as part of the company's bankruptcy settlement

-- Company officials expect construction at Abengoa's 88 mil gal/yr ethanol
plant in Madison, IL, will be complete by the fall

-- Xethanol sold their 5.6 mil gal/yr ethanol plant to Fiberight, LLC for an
undisclosed sum - the corn-based facility was destined to become a
cellulosic plant once the technique was perfected, acc. to a press
release=====================

-- Tom Harkin a US Senate Democrat will take the Chair of the Senate Health
Committee that was held by Sen. Kennedy, taking Harkin's Senate Ag Committee
Chairmanship will be Senator Lincoln of Arkansas.

-- Pending Tender: Bids are due Sept 9th in a CCC 16,000 mt sorghum donation
tender for Ethiopia.  Delivery to port is for Dec 11-21st

-- Pending Tender: Turkey's gov't grainary will hold 150,000 mt feed Barley
sale tender on Sept 10th

-- Pending Tender: Turkey's gov't grainary will also auction off 100,000 mt
Corn in a sale tender on Sept 10th from their Mersin port

-- Dalian May corn futures were off 1 yuan at 1,743 yuan/mt.(1$ = 6.83 yuan)

-- Liffe Nov corn futures were unchanged at 119.25 euros/mt.

-- Globex Corn Vol: 94,559; Pit Vol.: 8,145; Open Interest change: + 2,460

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

-- Outside markets: Energy Complex +0.77 at $72.08; Gold & Silver: +0.6 at
$992.9 & +0.080 at $16.435; US $ is off vs. Euro & Yen.

Cash Markets

-- CIF Corn steady up 2 . Sept. +54 to +57, LH Sept. +55 to +58, Oct. +58 to
+60, Nov. +58 to +60, Dec. +58 to +60, Jan. +49 to +52, Feb. +49 to +52
,Mar. +49 to +52

TREND:

Market continues to mark time with the markets with biggest shorts seeing
some short covering. Beans have the most length and had the least ability to
rally today.

Corn bounced 10 cents off the lows today. The market got right to the first
sell point before it failed. If you were not real fast did not get anything
sold. I am getting slow in my old age?  I am still looking for a bearish
report on Fri. I am suspicious of bigger gain in corn yields than hinted at
in this wire. The big gains in 2004 came in the Oct report but could happen
earlier this year due to the big plant populations?



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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