Welded pipe exports continue to be the growth engine in Bulgaria; however, with the local Bulgarian economy getting into greater difficulty, a rebound not in exports but in domestic demand is needed to turn the market situation around. The deep recessions of late 2008 and 2009 continue to have knock-on effects in the form of a high rate of non-performing loans and unemployment. The recovery in the Bulgarian welded pipe market is driven mainly by exports, while domestic demand remains poor. The metallurgical sector has seen the worst of the meltdown as the global markets are getting back on their feet. It is expected that the Bulgarian economy will shrink by three percent in real terms over the current quarter due to flagging domestic demand and falling investments. Over the past two weeks, domestic and export prices for Bulgarian welded pipes have declined by a maximum of €10/mt. Decreased prices for flats from the CIS and Europe may support the further decline in welded pipe quotations in Bulgaria.
Current offers of locally produced welded pipes and hollow sections of 2-5 mm wall thickness made from S235JR grade HRC according to EN 10219 are being given to the domestic market at around €620-630/mt ex-works, exclusive of 20 percent VAT and on actual weight basis. Offers of similar pipes with wall thickness of 1.5 mm made from HRC are in the range of €650-660/mt ex-works. Domestic quotations of water and gas ERW pipes made to EN 10255 are at €640-650/mt ex-works.
Export quotations of Bulgarian ERW pipes and hollow sections of 2-5 mm wall thickness made from S235JR grade HRC as per EN 10219 are at the level of €640-680/mt ex-works on actual weight basis for June-July production. Offers of similar pipes with wall thickness of 1.5 mm made from S235JR grade HRC as per EN10219 are in the range of €680-720/mt ex-works. Export quotations of Bulgarian water and gas pipes according to EN 10255 are at €680-700/mt ex-works. ERW galvanized pipes with 2-3 mm wall thickness made to DIN 2440/2444 are quoted in the foreign markets at on average €860-880/mt ex-works.