Beans opened a little better and into new contracts, but quickly fell into negative territory and then spent the rest of the session within a couple cents of unchanged ending the day narrowly mixed. Traders say when wheat fell from its highs it took the steam out of the soybean market. Traders say the market was slightly overbought and the market was vulnerable to a setback. Analysts note that there are not a lot of new fundamental inputs to influence the market. South American weather has been adequate and surprise rain in Argentina last week put an end to the recent idea that it is too dry in that country. Moisture in most growing areas of South America has been adequate. Traders say they expect volume to tail off during the holiday season but volume was relatively heavy on Monday in the Soybean complex 151,229 Soybeans, 8,546 Soybean Oil and 72,793 Soybean Meal traded on Monday. Funds Sold 1,000 Meal, 2,000 Oil and even in Beans

Early Opening calls are mixed. Brazil grain analyst Celeres released estimates of the Soybean crop. Celeres estimates 96% of the crop there has been planted vs. 94% this time last year and 92% last week. They commented that general conditions have been favorable and expect a record harvest. They are projecting a crop of 62.3 mmt. Oil world cut its forecast of Argentina's soybean crop in early 2008 to 48.2 mmt from their previous estimate of 48.5 mmt and m4 mmt harvested in early 2007. They note poor weather could reduce yields. Oil world also warned Brazil's soybean crop in early 2008 could be smaller than previously hoped at 60.8 mmt up from 2007 harvest of 58.5 mmt. and not that South American soybean production in general will turn out below potential. Oil world does expect combined soybean production in Brazil, Argentina, Bolivia, Paraguay and Uruguay to rise by 2.3 mmt. Overnight Malaysian Palm oil futures fell .8% as traders reportedly took profits from the previous strong gains. Expectations are for Malaysian palm oil output to fall 18% this month due to ber, as floods and heavy rains that have inundated plantations. Overnight Chinese Soybeans, Meal and oil futures were sharply lower on the news that tax rebates for exports will be eliminated.

Opening Calls. Soybeans mixed to 2 cents higher, Meal mixed, Oil .10 to .15 higher

Top News

-- 2008 Argentine soybean crop expected to rise only 200,000 mt to 48.20 mln mt when compared to last years crop of 48.00 mln mt, acc. to German based oilseed analyst. Oil World's latest estimate is down from prior month's 48.50 mln mt. The group says reduced yields due to poor growing weather is cause for their pull back on estimate.

-- Brazilian soybean crop forecaster, Celeres, estimates the 2007/08 crop is 35% sold as of Dec 14th vs the 34% seen in last week's reporting period & ahead of last year's 28% forward sales pace.

-- Brazilian soybean crop forecaster, Celeres, estimates 96% of the 2007/08 soybean crop has been planted vs 92% last week.

-- Monday's USDA Soybean Inspections: 35.561 mln bu.; expected 29.5 mln bu

-- Dalian Soybean futures Sept futures settled 80 yuan lower to 4,446 yuan/mt, all other contract months were lower also; active May & Sept Soymeal futures were off 80 & 86 yuan respectively; May Soyoil futures fell 98 yuan to 9672 yuan/mt

-- Malaysian Palm oil futures fell $7.46/mt to $880.60/mt in overnight trade

-- Monsoon conditions in key growing regions will likely lead to fall in Malaysian palm oil production during December. Long time industry analyst suggests output could fall as much as 18% in December vs November's output.

-- eCBOT Soybean Vol. 102,109; Pit Vol. 42,255; Open Interest Change: -40

-- Weather: 6-10 Day Forecast: Above Normal Temps. Normal to Above Precip. The Corn Belt will be mostly dry today into Friday. Saturday and Sunday will see some rain and snow. Temps normal to above.

-- Outside markets: Energy Complex + 1.25 at $ 91.88; Gold & Silver: + 6.8 at $801.5 & steady at $13.83; US $ up slightly vs. Yen & down slightly vs. Euro.

Cash Markets

-- CIF Soybeans steady . LH Dec. +?? to +34, Jan. +35 to +41, Feb. +30 to +43, Mar. +34 to +40, Apr. +31 to +38, May +34 to +40, J/J +39 to +43.

Nate Smith

SMS Brokerage

nsmith@jerrygulke.com

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