Chinese pipe market generally follows sideways trend

As of May 26, in China's three main steel markets, i.e., Shanghai, Guangzhou, Beijing, the average price of 20# (GB/T8162-1999) grade 108 mm x 4.5 mm seamless pipe now stands at $918/mt, with 20# (GB/T8163-1999) grade 219 mm x 6 mm seamless pipe at $923mt; meanwhile, Q195-215 grade 48 mm x 3.25 mm welded pipe prices stand at $780/mt, with Q215-235 grade 114 mm x 3.75 mm welded pipe prices at $774/mt. All the above prices include 17 percent VAT.
 
Buying activity on quiet side in Chinese seamless pipe market
 
Seamless pipe prices from producers in eastern China are mostly unchanged from one week ago, while Shanghai suppliers have decreased their offers by $7/mt week on week as end-users are reluctant to buy at their previous high price levels. Market insiders do not foresee any significant price changes in the coming days until after new strip prices are issued at the end of May.
 
The seamless pipe market in southern China is seeing only moderate buying activity, and traders are trying to avoid building up stocks in the current market conditions. Seamless pipe suppliers are not inclined to sell material under current market price levels, and it is difficult to conclude transactions during the seasonal rainy weather.
 
Buyers are not showing much interest in seamless pipe mills' offers for the time being in northern China. Demand is currently weak in the market, and actual bookings are aimed at meeting daily spot material needs. It should be considered that some mills may give offers below current price levels depending on their stocks. 
 
Prices stable in Chinese welded pipe market
 
Local traders in eastern China do not want to keep their inventories at high levels, and booking activities from mills are solely aimed at selling welded pipes for immediate delivery and cash payment. In fact, steelmakers' profit margins are already tight, and thus there does not appear to be room for further price decreases.
 
While seasonal rainy wearther in the southern regions may have a negative impact on the market, manufacturing activity in the southern parts of China is still expanding. However, traders are not inclined to sell off their inventories at negotiated prices and are sitting on the sidelines instead, expecting that welded pipe market prices will rise after the rainy weather subsides.
 
In the northern regions of China, producers have kept their price levels unchanged since the latest price adjustments around one week ago. Buying activity continues to be on the low side. Influenced by the lack of strip availability, supply shortages have been seen for certain welded pipe sizes. It is reported that the supply shortages are expected to be satisfied by local producers next week.