The Chinese seamless pipe market is experiencing seasonally-low buying activity. Over the past two weeks, domestic prices of seamless pipes have stayed almost unchanged, but in some cases they may indicate maximum increases of RMB 50/mt ($5-10/mt) due to higher round billet prices. Export quotations of seamless pipes from Chinese producers have increased by $10-50/mt over the past two weeks. Due to the onset of winter and the coming Spring Festival, many construction projects in the country will halt operations. As a result, seamless pipe demand in the first quarter of next year will be weak, while iron ore prices will rise. China's seamless pipe mills will thus be faced with this strong dual pressure in the coming period. Nevertheless, seamless pipe prices in the period up to the Chinese New Year holidays are expected to remain stable due to the strength of round billet prices.
Chinese domestic prices of 2"-8" seamless pipes according to GB/8163 are varying at around RMB 5,500-5,600/mt ($825-840/mt) ex-works, including 17 percent VAT. Domestic prices of seamless pipes, 2"-6" grade B as per ASTM A106/API 5L, are at around RMB 5,900-6,200/mt ($885-930/mt) ex-works.
According to the China Iron and Steel Association (CISA), in November this year China produced 2.26 million mt of seamless pipes, more than October's 2.11 million mt, and marking an increase of 11.8 percent year on year. Total production for the first 11 months of this year was 22.8 million mt, up 16.2 percent over the same period last year.
Current export offers of seamless pipes from Chinese manufacturers for 2"-12" grade B material according to ASTM A106/ASTM A53/API 5L are on average at $860-950/mt FOB, while 14"-20" seamless pipes are at $880-985/mt FOB. Export quotations for 2"-4" tubing J55 as per API 5CT, plain ends, are in the range of $1,050-1,100/mt FOB, while quotations for 6"-8" casing are at $950-1,000/mt FOB.