Jan Soybeans Closed into new high territory on Friday after a 16 ½ cent higher close. For the week Jan Beans gained 20 ½ cents. Traders say most of the volume was done on the screen as the holidays have impacted floor trading with lighter volume. Volumes were good however with the CBOT reporting 165,036 Soybeans, 59,939 Oil and 65,150 Meal trading. Funds were active buyers buying an estimated 5,000 Soybeans, 3,000 Meal and 3,000 Oil.

Early Opening calls are slightly weaker. Not a lot of new news in this Holiday shortened week. Early close today at 12:00 noon. Chinese Finance Minister announced it will extend the 1% import duty on Soybeans to the end of March. Previously the duty was set at 3%. The Chinese Ag minister told China's news agency that grain output exceeded 500mmt. this year vs. 497.6 mmt last year, the fourth consecutive year of rising output. He noted that the output fell short of demand. Traders say the Acreage fight is on and should keep beans firm going into the spring. Concerns about some forecasts for drier-than-desired crop weather in Argentina and early firm tone in crude oil and soyoil also supportive. The commitment of traders report released Friday shows Soybeans long 144,366 off 11,922, Meal long 76,103 off 3,554 and Oil long 47,757 off 1,201. The supplemental report showing index funds shows Soybeans long 183,636 down 9, Oil up 2,402 at 75,828. Overnight Chinese Soybeans and meal closed higher. Malaysian Palm oil futures were higher overnight.

Early Opening Calls: Soybeans 1 to 2 higher, Oil .05 to .10 higher, Meal .50 to $1.00 higher.

Top News

-- While Chinese domestic grain output didn't meet demand this year, the Chinese Ag minister says production did rise above 500 mln mt, up 2.8% from last year's 497.5 mln mt. Says 2008 raising grain production is a top priority

-- Friday's USDA Cattle On Feed Recap

USDA Cattle On Feed Dec 1: 101%; expected 99.0%

USDA Cattle Placements during Nov: 112%; expected 104.0%

USDA Cattle Marketings during Nov: 97%; expected 98.0%

-- Dalian Soybean Sept futures settled at 4,509 yuan/mt a rise of 40 yuan, most other months settled higher. Sept Soymeal ended 46 yuan higher at 3,336 yuan/mt; Soyoil futures settled strong, active May rose 106 to 9,898 yuan/mt

-- Malaysian Palm oil futures rose in overnight trade, March futures ended up $11.35 at $ 907/mt; last week's positive export figures, rains affecting plantations & higher crude oil prices helping support overnight market acc. to traders

-- eCBOT Soybean Vol. 112,845; Pit Vol. 41,796; Open Interest Change: -16,532

-- Weather: 6-10 Day Forecast: Above Normal Temps. Above Normal Precip. The Corn Belt looks mostly dry today and Tuesday. Wednesday will see some showers and snow. Dry Thursday and Friday. Temps normal to above.

-- Outside markets: Energy complex -.10 at $93.21 ; Gold & Silver -1.8 at $ 809.8 & steady at $14.35; US $ up slightly vs. Yen and down vs. Euro

Cash Markets

-- CIF Soybeans steady off 3 . LH Dec. +35 to +38, Jan. +38 to +45, Feb. +30 to +38, Mar. +33 to +41, Apr. +27 to +33, May +32 to +40, J/J +35 to +40.

Nate Smith

SMS Brokerage

nsmith@jerrygulke.com

toll free: (877) 787-6278

local: (312) 896-2090

fax: (312) 896-2052

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