Despite most offshore mills' persistence to raise prices and maintain higher price levels since the beginning of the month, US traders have been able to strike a few deals here and there lately.
As previously mentioned in our last report, domestic and international hot rolled coil (HRC) increases led just about all offshore structural standard pipe mills to increase prices $1.00 cwt. to $2.00 cwt. ($22/mt to $44/mt or $20/nt to $40/nt) by the beginning of September; however, many traders were skeptical over the staying power of these new prices, as US ex-mill prices were stable to only slightly up, demand had not increased and there was already additional tonnage arriving from offshore. According to the US department of commerce, 30,502 mt (license data) of imported structural pipe and tube arrived to the US in August, up from 23,030 mt (preliminary census data) which arrived in July. However, it appears that September arrivals will help curb the oversupply a little, as only 8,450 mt (license data) had been imported to the US through the first 14 days of September.
Although offshore standard pipe prices currently appear to remain within ranges offered a couple weeks ago, traders have been able to conjure up some deals, but not for lack of extensive negotiating. A couple recent deals out of Dubai on electric resistance welded (ERW) black plain end (BPE) A53 Grade A standard pipe have concluded within the range of $41.50 cwt. to $42.00 cwt. ($915/mt to $926/mt or $830/nt to $840/nt) duty-paid, FOB loaded truck in US West Coast ports, despite the more common range being $43.00 cwt. to $45.00 cwt. ($948/mt to $992/mt or $860/nt to $900/nt) duty-paid, FOB loaded truck in US Gulf ports. These deals were also said to have booked for less than what is usually considered "significant tonnage".
Traders have also been able to book deals on ERW galvanized plain end (GPE) A53 Grade A from India at approximately $48.50 cwt. to $49.50 cwt. ($1,069/mt to $1,091/mt or $970/nt to $990/nt) duty-paid, FOB loaded truck in US Gulf ports. The common offer of this product from Indian mills is more around $50.00 cwt. ($1,102/mt or $1,000/nt) duty-paid, FOB loaded truck in US Gulf ports.
While import pipe offer ranges are not likely to officially come down over the next couple weeks, the ability to occasionally book a deal should persist. Unlike past years, traders will not be clamoring for October orders for early first quarter arrivals. Inventory levels are not too inflated, but the demand and predicted first quarter projects remain too low for most buyers to warrant taking the risk.
