Most traders continue to experience a slide in US pipe import activity, as demand and prices have trended slightly down since our last report two weeks ago.
In particular, the oil country tubular goods (OCTG) sector has lost much of its edge in both price stability and booking activity over structural standard pipe since the beginning of July. Imports have softened further over the past couple weeks, with most offerings of API J55 electric resistance welded (ERW) OCTG casing sliding an average of $2.00 cwt. ($44/mt or $40/nt) from previous levels. Taiwanese and Turkish offerings for this product are currently ranging from approximately $46.00 cwt. to $48.00 cwt. ($1,014/mt to $1,058/mt or $920/nt to $960/nt) duty-paid, FOB loaded truck in US Gulf ports, while Korean offers are mostly found in a slightly higher range, although Korean mills may be more willing to negotiate on larger orders.
Traders, while seeing a decline in OCTG quoting activity, are also keeping a closer eye on tonnage arriving from overseas sources. According to license data from the US department of commerce, 203,261 mt of OCTG tonnage (61,127 mt of which is from Korea) was imported to the US in July, which is up from 174,908 mt (preliminary census data) in June, and dwarfs the 35,131 mt in OCTG imports year-on-year. The market is more stable than last year; however, with more tonnage arriving and less activity being quoted, one or two cancelled bookings could wreak havoc in the market.
On the other side, activity has remained relatively neutral in the structural standard pipe sector in recent weeks. Although, standard pipe import activity has continued to be quiet since May. But while activity appears to be more stable, regarding expectations, than OCTG, standard pipe prices have also decreased by about $2.00 cwt., or higher, since our last report, with average offers for ERW black plain end (BPE) A53 Grade A standard pipe from Turkey and India now being seen for around $40.00 cwt. ($882/mt or $800/nt), and even lower for the right size and specs. Meanwhile, Korean offers for this same product are ranging slightly higher, at approximately $41.00 cwt. to $43.00cwt. ($904/mt to $948/mt or $820/nt to $860/nt) duty-paid, FOB loaded truck in US Gulf ports.
Many traders believe the bottom is near, or at least somewhere on the horizon, for import steel prices. Hot rolled coil (HRC) prices may finally be starting to stabilize, and the traditional best season for pipe import offers is approaching; late January to early February arrival times.