A market which is still suffering, with demand levels that lack brilliance and prices which are not entirely satisfactory - this is the consensus which emerged from the discussion on the Italian welded tubes and tubular goods market which included the participation of Vittorio Boghi (Ferroinoxmetalli), Francesco Bolpagni (Morandi), Alessandro Leoni (Marcegaglia), Andrea Loda (Lodafer), Rino Pinotti (Marcegaglia) and Enrico Vettorato (Alba Siderurgica).
In recent weeks the tubes segment has suffered from the continued application of discounts by producers. This market movement was sparked by a series of interlinked factors.
The first factor was the expectation of a fall in quotations for coils, which was due to the fluctuations in offers coming from some producers. In second place, after an excellent January-April period from the point of view of real demand, the last two months saw a decline in demand. Added to this was the slowdown in apparent demand, in turn caused by various factors such as the reduction in quotations for coils and the strong competition between tubemakers which caused an increase in discounting, and also by the high level of warehouse stocks which caused distributors to begin destocking. All these conditions had a cooling effect on the optimism of the traders and caused everyone in the market to move with greater caution and order only the strictly necessary quantity of goods.
Turning to imports, currently offers from abroad do not seem particularly attractive. After the measures introduced in China to discourage exports and the reduction in the prices of the Italian tubemakers, the price difference no longer appears sufficiently large to justify the various difficulties (bureaucratic etc.) and the long periods necessary for the delivery of imports. As regards exports, on the other hand, in January-April strong levels were registered whereas in May they began to decline to the normal levels for the time of year.
For the coming weeks, the participants in the discussion said that prices for tubular goods would require an upward adjustment, given the extremely low difference between quotations for coils and those for welded tubes. This adjustment, however, does not seem immediately possible due to conjunctural factors such as the high stock levels and the tubemakers' need to sell more material before they close for the summer holiday. Thus, the end of the destocking period must first be awaited, and this may be realistically expected in the days immediately before the holidays or else in the first days of September.