Soybean prices in Chicago rose slightly on Tuesday, recouping part of the previous session’s losses, though expectations of a plentiful US harvest capped the advance.

In its weekly report on Monday, the US Department of Agriculture raised its rating of the nation’s soybean crop quality while keeping corn ratings unchanged, contrary to analysts’ expectations of a slight decline.

The department said 71% of the corn crop was in good-to-excellent condition as of August 24, unchanged from the previous week. It raised the soybean crop rating to 69% good-to-excellent, compared with 68% the prior week.

Expectations for higher US production come as China continues to retreat from the market amid trade tensions with Washington. China’s ambassador to the United States said Sunday that US protectionist policies were undermining agricultural cooperation with China, warning that farmers should not bear the cost of the trade war between the world’s two largest economies.

Separately, Russian agricultural consultancy IKAR raised its forecast for Russia’s 2025 wheat crop to 86 million metric tons, up from 85.5 million previously, and lifted its wheat export estimate to 43 million tons from 42.5 million. Russia is the world’s largest wheat exporter.

Traders noted that commodity funds were net sellers of soybean, corn, soybean meal, and soybean oil contracts on the Chicago Board of Trade on Monday, while being net buyers of wheat contracts.

Corn

Corn futures for December delivery fell 0.7% to 4.09 dollars a bushel at the end of the session.

Soybeans

Soybean futures for November delivery rose 0.2% to 10.49 dollars a bushel.

Wheat

Wheat futures for December delivery rose 0.4% to 5.31 dollars a bushel.

Oil prices fell during Tuesday trading, giving up the previous session’s gains as concerns over disruptions to Russian supplies eased.

Despite heavy Ukrainian attacks on Russian oil refineries, Russia boosted its crude export activities from its western ports in August by 200,000 barrels per day, according to sources cited by Reuters.

The US Energy Information Administration will release official crude inventory data for last week on Wednesday.

As for trading, Brent crude futures for October delivery settled down 2.3%, or 1.58 dollars, at 67.22 dollars a barrel.

US West Texas Intermediate (WTI) crude futures for October delivery fell 2.4%, or 1.55 dollars, to close at 63.25 dollars a barrel.

Although it provided most of the world’s supply growth over the past decade, US shale oil producers remain subject to the influence of OPEC+, and Saudi Arabia in particular. The alliance’s decision to swiftly unwind previous output cuts injected more than 2 million additional barrels per day into the market in a short time, causing a major buildup in global inventories and driving oil prices to collapse. The scene is familiar and repetitive: a large supply surplus that takes a year or more to clear, and once traders are convinced they can obtain any extra barrel at any time, prices tumble.

As always, what goes down eventually rises again. Producers have scaled back activity, both onshore and offshore, to preserve capital in preparation for the next upturn. But commodity prices are not the only factor behind the slowdown in exploration and production; supply costs and productivity also shape company decisions on allocating capital to new drilling. If history is any guide, the industry is now at a bottom in terms of oil prices from these perspectives. This does not mean prices cannot fall further — they might — but the fundamentals that determine whether production grows or contracts, namely supply costs and well productivity, are tilting toward higher prices in the near future.

As we enter the final third of 2025, several factors are shaping shale output. US production has clearly stabilized and may have begun to decline, according to Energy Information Administration (EIA) data. As of August 8, total US output stood at 13.327 million barrels per day, about 2% below the peak of 13.604 million barrels per day recorded on December 13, 2024. Of that figure, more than 9.6 million barrels per day came from the five largest producing states — Texas, New Mexico, North Dakota, Oklahoma, and Utah — where shale forms the largest share.

What cannot be denied is that steady daily growth in US output has stopped. As to why, debate continues. Possible reasons include: lower prices due to oversupply, reduced drilling activity, depletion of Tier I sites, the effects of mergers and acquisitions in the exploration and production sector, or even the impact of tariffs. Each of these factors may be contributing to crude price volatility.

The key point, and the central thesis of this article, is that costs are rising for the largest contributor to US oil output — shale — while well productivity is declining. Rob Conners of The Crude Chronicles published research pointing to an inflection point in both factors that has not yet been reflected in oil price forecasts. He said:

“In 2024, well productivity (measured as output per well) among the largest non-OPEC producers grew by only 3% — one of the slowest annual growth rates in the past 14 years, despite record output levels. History shows that when well productivity growth slows, non-OPEC producers are forced to turn to higher-cost fields to maintain output, which raises supply costs and pushes prices higher, particularly if demand remains stable or grows.”

In other words, the rising cost of developing these reserves requires higher prices to sustain activity; otherwise, production will not materialize.

Technology has helped deliver a modest productivity boost in the past four years, as companies radically rethought horizontal drilling and fracturing techniques. Lateral well lengths now routinely exceed 10,000 feet in major producing areas, with 12,000-foot wells becoming more common due to the wave of mergers. Drilling 15,000-foot wells has also become widespread.

Clay Gaspar, CEO of Devon Energy, told investors at a conference:

“How many dollars are we spending to drill the same number of wells, or perhaps more importantly, for the same lateral length? With longer wells and more innovation, we’re achieving greater capital efficiency. If we can get production from a 4-mile lateral well in one go, that’s a big win.”

Other innovations include adding more fracturing stages to inject greater volumes of sand into the reservoir, using artificial intelligence to optimize pumping, and placing more sand deeper into rock formations to unlock wider zones and convert lower-quality rock into higher productivity.

But views differ on whether technology can sustain current output levels. Chevron CEO Mike Wirth insisted the Permian Basin can maintain large-scale production for years to come, while Travis Stice, former CEO of Diamondback Energy, was less optimistic, saying on an investor call: “Production has peaked and will begin declining this quarter.”

Whichever view proves correct, the reality is that US output has already fallen by several hundred thousand barrels per day this year.

For this writer, the gap between currently planned projects and what is needed to avoid “energy poverty” in the near future means the shale sector still has a promising outlook. Despite today’s cloudy picture caused by oversupply, this phase is temporary — better days lie ahead for energy companies.

Palladium prices fell during Tuesday trading despite a weaker dollar against most major currencies, as the industrial metal faced volatility driven by uncertainty over whether the United States will impose tariffs on Russian palladium exports.

Sibanye-Stillwater has asked the United States to consider imposing tariffs on imports of Russian palladium, a move that could add to price swings in the metal.

The Johannesburg-based company said its petition adds further uncertainty to the outlook for platinum group metals (PGMs), after a rally since the start of the year driven by lower output in South Africa during the first half and thin liquidity in the spot market.

Neal Froneman, the company’s CEO, said in a statement on its website dated July 31:

“We believe Russian palladium imports are being sold below market prices due to a number of factors, which began primarily after Russia’s invasion of Ukraine in 2022.”

He added: “Securing protection from subsidized and dumped Russian imports will allow Sibanye-Stillwater, its employees, and the entire US PGM industry to compete in a fairer environment.” The petition is expected to be decided within 13 months.

Russian company Nornickel, the world’s largest palladium producer with a 40% share of global mined output, declined to comment.

Sibanye-Stillwater, which holds assets in South Africa and the United States, reported a second consecutive annual loss last year after writing down 500 million dollars in US palladium assets amid lower prices.

Spot palladium prices have risen 31% since the start of 2025, with positive expectations for the rest of the year. Analysts surveyed by Reuters in July forecast palladium will rise in 2025 for the first time in four years, supported by platinum’s gains.

However, Heraeus analysts warned that “imposing tariffs on the Russian metal will not necessarily affect market balance, but could redirect global flows of the metal, adding to price volatility.”

According to Trade Data Monitor, Russia and South Africa are the main suppliers of palladium to the United States. China ranks second after the US as the largest buyer of the metal from Russia.

US imports of Russian palladium rose 42% year-on-year to exceed 500,000 troy ounces in the January–May period, according to Heraeus.

Palladium and other PGMs are widely used in purifying exhaust from gasoline-powered cars and have so far avoided both US sanctions on Russian companies over the war in Ukraine and any import tariffs announced by President Donald Trump.

Meanwhile, the dollar index fell 0.3% to 98.1 points as of 16:07 GMT, after hitting a high of 98.5 and a low of 98.1.

As for trading, December palladium futures fell 0.9% to 1,103.5 dollars an ounce as of 16:09 GMT.