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Corn remains in a downward trend

For The Week: for the week of September 8, December corn futures value
increased 2.6%, November soybean futures value increased 2.1% and December
CBOT SRWW value decreased by 4.3%.

For The Month: thus far for the month of September, December corn futures
value down 3.8%, November soybean futures value down 9.3% and December CBOT
SRWW value down 10.2%.

Special Report on USDA's September 12th Monthly Crop Report

Corn Domestic Stocks and Stocks to Use: 2007/08 presently estimated at
1.576 bil bu vs August's 1.576 billion bushels vs 2006's 1.304 billion. For
2008/09 end stocks are projected at 1.018 billion bushels vs August's USDA
estimate of 1.133 billion bu. 2007/08 Stocks to use for September estimate
is 12.3% vs 12.3% last month vs 2006's 11.6% and 2005's 17.5%. USDA's
2008/09 estimate for end stocks to use is 8.1% (second tightest dating back
to 1980) vs August's estimated 8.9% with 1995 the lowest at 5% dating back
to 1980.

World Stocks and Stocks to Use: 2007/08 world stocks of 123 million tonnes
vs last months 122 million tonnes vs the previous years 109 million tonnes.
USDA 2008/09 September end stocks are estimated at 110 million tonnes vs
its August estimate of 112 million tonnes. 110 million tonnes of world end
stocks would represent the fifth tightest dating back to 1980. Record high
world stocks was 1986's 205 million tonnes. Record low end stocks for the
world was 1983's 89 MMT. 2007/08 End stocks to use at 14.2% vs 14.0% last
month and compares to USDA's 2008/09 September estimate of 12.5% vs
August's estimate of 12.6%. At 12.5% end stocks to use, it represents the
lowest on record dating back to 1980 with the second tightest in 2006 of
13.2%.

Season Average Farm Price: USDA estimates the Sept 2008/09 Season Average
Farm price at $5.50/bushel vs its August estimate of $5.40 bushel. The SAFP
for 2007/08 is $4.20 and 2006/07 was $3.04/bu.

Wheat Domestic Stocks and Stocks to Use: 2008/09 end stocks are projected
at 574 mil bu via the September WASDE vs 574 million bushels estimates in
the August WASDE. 2008/09 end stocks to use projections are
25% for the Sept WASDE report vs the same for the August WASDE and up 87%
year on year.

World Stocks and Stocks to Use: 2008/09 world end stocks are projected at
139 million tonnes vs the August WASDE estimate of 136 million tonnes, up
21 MMT yr on yr. This compares to the 1995/96 year on year increase of 8
MMT regarded as a notable increase. 2008/09 world end stocks to use for
September is estimated at 18% vs 17.7% estimated in the month of August vs
16.2% for the 2007/08 marketing year. At 18% end stocks to use, it
represents the third tightest level dating back to 1980.

Season Average Farm Price: The SAFP for 2008/09 at $7.25 per bushel for the
September estimate vs August's estimate of $7.25 per bushel.

Soybean Domestic Stocks and Stocks to Use: 2007/08 presently estimated at
135 million bushels vs 135 million bushels last month vs 574 million the
previous year. 2008/09 end stocks are estimated at 135 million bushels vs
the August estimate of 135 million bushels. The 135 million bushels are the
third least amount since 112 million in 2003 and 1996's 132 million.
2007/08 Stocks to use as of the Sept WASDE are 4.6% vs August estimate of
4.4%. The Sept 4.6% estimate for 2007/08 is the second lowest dating back
to 1980, with 2003's 4.4%. 2008/09 end stocks to use for August are
projected at 4.6% tied with 2007/08 vs August estimate of 4.5%.

World Stocks and Stocks to Use: 2007/08 world stocks of 50 million tonnes
vs last months 49 million tonnes vs last years 63 million tonnes. 50
million tonnes compare to a five year ave of 48.2 million tonnes.
End stocks to use at 16.3% vs 16% last month. The five year ave has been
17.96%. 2006 end stocks to use for world soybeans was 21.2%. USDA's world
2008/09 end stocks for soybeans for the month of September is estimated at
51 million tonnes vs 49 million tonnes the previous month. 2008/09 end
stocks to use are estimated at 16.3% vs August's 15.7%.

Season Average Farm Price: USDA's projected 2008/09 SAFP for September is
projected at $12.35 per bushel vs its August estimate of $12.50 per bushel.

Corn Commentary: Friday's trade reacted favorably to a smaller corn crop
estimated via the Sept WASDE vs the August estimates. The trade was none to
shy about pointing out corn production of 12.072 billion bushels is still
the second largest on record, however the trade does need to be reminded
2008/09 end stocks to use are the second lowest on record dating back to
1980. Big crop yes but let's not forget big demand. The combination of a
strong crude oil futures market, lower dollar supported Friday's efforts.

After the close of the side by side trade and before the electronic
trade on Sunday evening, it is interesting to note in the most recent
weekly net change CFTC report, non commercials sold 8,272 contracts of corn
with the commercials buying 13,001.

Corn Technical Commentary: Dec corn remains in an downward trend since
August 25 as pointed out within our Allendale Advanced Charts. Encourage is
a close above 5580 short term moving averages but we need at least one more
above the 5580 mark to turn trader momentum from bearish to at least
neutral.

Vital Technical Indicator: the next projected major turn day is forecasted
for Sept 25.

Trade Idea(s): Stand Aside

Working Option Strategy(s): 9/5 Bought 1 600 call @ 22. Risk to 12. Obj 38.
Closed @ 23

Soybean Commentary: for Friday's trade, futures reacted in a positive
fashion from the smaller yield and crop production for US soybeans. The
combination of wet weather forecast delaying the soybean harvest in the
Delta, positive crude oil and weaker US dollar trade all helped to support
soybean futures. However an increase in old and new marketing year world
stocks tempered a major rally for Friday.

After the side by side session and before the Sunday evening
electronic trade it is interesting to note in the most recent weekly net
change CFTC report, non commercials sold 18,114 contracts of soybeans with
the commercials buying 20,184. Allendale anticipates a positive opening for
soybean futures Sunday evening.

Soybean Technical Commentary: Nov soybean futures remain in a downtrend
since early July. As advised in our Allendale Advance Charts, Nov soybean
futures remain in a descending triangle. A breech of 11570 is expected to
trigger a sell signal. Immediate overhead resistance is 12300.

Vital Technical Indicator: the next projected major turn day in store for
soybeans is Sept 24, soybean meal Sept 29 and Sept 23 for soybean oil.

Trade Idea(s): there are no new futures only trade recommendations.

Option Strategy(s): 09/11 Bought 12.60 call at 37 cents, Risk of 22 cents.
Obj 69. Closed @ 43 cents

Wheat Commentary: USDA did not change production or end stocks data for the
US but did notably increase world end stocks and end stocks to use levels,
keeping ideas of a major rally in check throughout much of the trade
session. At the final bell, wheat futures at all three exchanges closed
lower on the day. Fundamentals and technicals are bearish.

After the side by side session and before the evening electronic trade
on Sunday evening, it is interesting to note in the most recent weekly net
change CFTC report, non commercials sold 6,784 contracts of wheat with the
commercials buying 8,844. Allendale anticipates a neutral to negative
opening for wheat futures Sunday evening, and highly dependent on the corn
and soybean openings strength or lack of.

Wheat Technical Commentary: the technical trend remains down since August
21. Short term resistance is 7250, and then 7460.

Vital Technical Indicator: the next schedule projected major turn day in
store for wheat is Wednesday Sept 30.

Trade Idea(s): Dec CBOT Wheat:(09/15) Sell 1 @ 7530. Risk and reverse 7770.
Obj 6860

Dec KCBT Wheat:(09/15) Sell 1 @ 7870. Risk and reverse 8020. Obj 7420

Dec Minn Wheat:(09/15) Sell 1 @ 8120. Risk and reverse 8300 Obj 7690

Option Strategy(s): there are no new options only trade recommendations at
this time.

Energies: - Crude oil ended today up $0.31 at $101.18 with a low for the
day at $100.03 in the electronic market and $99.99 in the energy pit. What
concerns Allendale regarding Crude Oil is that the Dollar Index has been
down at least $1.00 for most of the session, we have a hurricane pointed at
Galveston, Texas and crude still can't manage a sharp rally. Ask yourself
what crude would have done four months ago if we had the Dollar Index down
this much and a major hurricane rumbling in the Gulf. We will leave our
current recommendation active, but should Crude take out $100 on a closing
basis before we get the chance to sell, we may lift the recommendation and
stand aside to see if the market wants to put in a bottom at this level.
Energies as a whole are in a down trend and strength is to be sold rather
than weakness bought until the pattern changes.

Technical Commentary: Support in the October contract is found
psychologically at $100.00 and again at $96.00 with resistance near
$109.10.

Trade Idea(s): Sell 1 October Mini-Crude at $106.75 and risk to $110.05
with an objective of $97.75. Taking profit, if you so choose, just above
$100.00 would not be discouraged.

Working Trade: 09/12 Bought 1 November RBOB and Sold 1 October RBOB at 18
cents premium October. Risk to 21 cents premium October with an objective
of 8 cents premium October. The spread is currently trading at 16.5 cents
premium October.

Metals: - Metals are rebounding today as the Dollar is seeing a lot of sell
pressure. It took a full $1.00 sell-off in the Dollar Index to get Gold to
rally $20, yet we've seen $0.50 rallies in the index cause $30 losses in
Gold. December Silver still hasn't seen $11.00 today in spite of the
Dollars weakness. Again, these markets are in a downtrend and strength is
to be sold.

On a side note - The Gold/Silver ration is currently around 71:1. This
ratio is getting even further out of whack. Keep your eyes open as we may
look to Buy Silver and Sell Gold as a spread trade in the near future.

Technical Commentary: Support in the December Gold contract is seen at $756
and again near $723 with psychological support at $700. Resistance is seen
near $795 and again around $812.

Trade Idea(s): Sell 1 December Gold at $786.90 and risk to $801.90 with an
objective of $726.90.

Softs: - The Soft Markets were mixed again today with Sugar, Cotton, Cocoa,
and Coffee higher. Lumber itself was mixed with some months up and some
down. Rice was down sharply today as the USDA has overall Rice production
for the year up a full percent from last year even with the recent flooding
and harvest delays.

We may have seen a major top in the Cocoa market. Recent news of stalled
export registration and stalled shipments in the Ivory Coast is no matter
to the market as lower crude prices and fund liquidation of commodities
amid the stronger U.S. dollar are taking center stage.

Trade Idea(s): Sell 1 December Cocoa at 2665 and risk to 2730 with an
objective of 2465.

Technical Commentary: December Coffee has been trading in a sideways
pattern on the chart with the exception of a sharp rally in late June. I
would look to continue to play the range. See new recommendations below.

Trade Idea(s): Buy 1 December Coffee at 137.00 and risk to 133.85 with an
objective of 147.00. Sell 1 December Coffee at 147.00 and risk to 150.15
with an objective of 137.00.

Technical Commentary: March Sugar closed above the 100 day MA for the
first time in five sessions. Should the market close above the 100 day MA
again next Monday and above the 10 day MA, we will likely recommend a buy
in this contract. Stay tuned Monday for a possible trade recommendation.

Lean Hog Commentary: Our big bearish downside objective has been reached
today and it was done a bit earlier than we expected. In a week where the
trade was looking for a bottom in cash hogs and cash pork futures eneded
breaking to new lows. It is not uncommon on a seasonal basis for cash hogs
to post a short term bottom and small rally into late September. After that
small rally cash hogs usually plow lower into mid November. You may hear
some good news in that this week's kill was only 3.5% higher than last year
compared with the 6 to 7% higher numbers in recent weeks. This is still not
bullish. 3.5% on top of last year's record levels is still a brand new
record. This week's kill hit 2.3 million head. Slaughter levels will jump
again in October and November. Last year we did not hit 2.3 million head
until three weeks from now. With futures already hitting our downside
objective, a month or two ahead of expectations, we will not rush to jump
out of hedges yet. For trading the return to lower prices supports the two
bear positions we have recommended.

Lean Hog Technical Commentary: The trend is down. The downside gap from
6675 to 6680 was filled and the market closed even lower which is bearish.

Vital Technical Indicator: Next projected major turn day for lean hogs is
September 22.

Trade Idea(s): Bear Spread - Bought the Feb/Sold the Oct at 650. Settled at
717.

Option Strategy(s): Sold 1 December $72 call at $2.20. Settled at $1.35.

Live Cattle Commentary: Futures ended stronger today as traders noted
higher corn, higher outside markets, and a sharply lower US dollar. We also
can find support from beef. Wholesale beef ended the week slightly higher.
So far we have not seen any sign of big shifts in demand that futures
traders are concerned about stemming from the continued economic concerns.
Live based cash cattle prices have averaged three weeks in a row. We would
guess this afternoon's trading, which has yet to occur, will make it four
weeks now a $99. We would guess next week will be the first week in a long
time that bulls begin to test for a bottom here. If futures can hold their
ground we may attempt to test for a bottom with a short put. Overall we
feel October and December futures are clearly undervalued.

Live Cattle Technical Commentary: The trend is down. New lows for the
downtrend were made Thursday.

Vital Technical Indicator: Next projected major turn day is the 18th for
live cattle.

Trade Idea(s): Stand aside.

Option Strategy(s): Stand aside.

For The Week: for the week of September 8, December corn futures value increased 2.6%, November soybean futures value increased 2.1% and December CBOT SRWW value decreased by 4.3%.

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