2007 Price Outlook The challenge of publishing a price outlook for the coming year has never been more daunting. Index funds, hedge funds, an unsettled world, and a dash of change in the air have created an environment where 6 months is an eternity, as market velocity can escalate in a New York minute. As we try to assess what is new that might change the landscape of the marketplace for 2007 we first must look at the sheer size of Index and Hedge fund positions and trade that can distort the magnitude of both an upswing and a downswing in price (note 2006 metals and natural gas gyrations). Secondly, the new electronic dominated markets seem to be creating a lack of transparency that is resulting in a more volatile intra-day trade and wider bid and asked spreads in the basic commodity markets.. A more subtle change is in the makeup of big money trading. We have about completed the cycle of creating new commodity products for the novice investor to trade, ala index funds and ETF’s. Those investment vehicles are now in place and understood, but in short term retrospect, have not been very successful in making money for the investor. And, when you consider the return on an investment in the U.S. equity market was in excess of 15% last year and 30 to 90 % on overseas equity markets, where is the incentive for the investor to seek out commodity based products this coming year? This could create unpredictable volume liquidation across all the markets, and predictably reduce energy trade and take some luster from the metals markets in 2007…..

Finally, we come to the biggest change in our commodity markets in 20 years – the subsidized and dictated utilization of productive farm land in the U.S. and the world to produce renewable fuels. This change has already positively affected farming economics and raised price floors on the larger acreage agricultural markets. It has created the need for a more involved user community, demanded a new awareness of weather threats to production globally, and initiated a new era where food competes with energy for available agricultural energy alternatives. On a longer term basis the worlds’ emphasis on bio-fuels will dictate how and where crops are produced, increase monies available for crop and bio energy research, shift subsidies from agricultural and energy production to bio-fuels usage and production, and ultimately eliminate the phrase ‘farm subsidies’, How all this will play out and what the impact will be on farming, the political landscape, and particularly on the consumer, is a matter of debate. However, it seems inevitable that at some point the potential dramatic influence on food prices will demand the market’s attention and ultimately the worlds’ attention. The only upside in this scenario would be the resulting focus to develop new and better energy sources to hopefully eventually reduce the world’s dependence on petro-fuels. So the stage is set for an exciting year – “The Year of the Agricultural Markets”. Even without an “event” we could see unprecedented volatility, risk, and angst in that arena. In looking backward, last years; energy and metal trading hysteria may seem calm in comparison to what lies ahead for the agricultural marketplace in For your convenience, and when helpful, we have inserted links to last years Linn Group Trade Outlook 2006 charts. In order to access these slides you need to select the text box so that it is highlighted, then Right-Click your mouse and go to “Open Hyper Link”. This will open a web browser in which you can view last year’s chart and related recommendations. If you are unable to launch the window, the full pdf of the Linn Group Trade Outlook 2006 can be accessed by clicking Here Here

Linn Group 2007 Trade Outlook CRB Index Link to Linn Group’s 2006 CRB Outlook

Linn Group 2007 Trade Outlook Dow Jones Link to Linn Group’s 2006 Dow Jones Outlook

Linn Group 2007 Trade Outlook S&P

Linn Group 2007 Trade Outlook Bonds

Linn Group 2007 Trade Outlook Dollar Index Link to Linn Group’s 2006 Dollar Index Outlook

Linn Group 2007 Trade Outlook Natural Gas

Linn Group 2007 Trade Outlook Heating Oil

Linn Group 2007 Trade Outlook Crude

Linn Group 2007 Trade Outlook Unleaded Gasoline Link to Linn Group’s 2006 Unleaded Outlook

Linn Group 2007 Trade Outlook Corn Link to Linn Group’s 2006 Corn Outlook

Linn Group 2007 Trade Outlook Wheat

Linn Group 2007 Trade Outlook Wheat-Corn Spread

Linn Group 2007 Trade Outlook Soybeans Link to Linn Group’s 2006 Bean Outlook

Linn Group 2007 Trade Outlook Soybean Meal Link to Linn Group’s 2006 Meal Outlook

Linn Group 2007 Trade Outlook Soybean Oil Link to Linn Group’s 2006 Soybean Oil Outlook

Linn Group 2007 Trade Outlook Oilshare

Linn Group 2007 Trade Outlook Lean Hogs Link to Linn Group’s 2006 Lean Hog Outlook

Linn Group 2007 Trade Outlook Feeder Cattle

Linn Group 2007 Trade Outlook Live Cattle Link to Linn Group’s 2006 Live Cattle Outlook

Linn Group 2007 Trade Outlook Feeder Cattle – Live Cattle Spread

Linn Group 2007 Trade Outlook Gold Link to Linn Group’s 2006 Gold Outlook

Linn Group 2007 Trade Outlook Silver Link to Linn Group’s 2006 Silver Outlook

Linn Group 2007 Trade Outlook Coffee Link to Linn Group’s 2006 Coffee Outlook

Linn Group 2007 Trade Outlook Sugar Link to Linn Group’s 2006 Sugar Outlook

Linn Group 2007 Trade Outlook Cocoa Link to Linn Group’s 2006 Cocoa Outlook

Linn Group 2007 Trade Outlook Cotton Link to Linn Group’s 2006 Global Trade Outlook (PDF) Reproduction or rebroadcast of any portion of this information is strictly prohibited without the written permission of the Linn group, inc. the information reflected herein is derived from sources believed to be reliable; however, this information is not guaranteed as to its accuracy or completeness. Opinions expressed are subject to change without notice. this material and any view expressed herein are provided for informational purposes only and should not be construed in any way as an inducement to buy or sell commodity futures or options contracts. The Linn group and its officers, directors, employees and affiliates may take positions for their own accounts in contracts referred to herein. Trading futures involves risk of loss Link to Linn Group’s 2006 Cotton Outlook