The Chinese seamless pipe market has been on a weak trend during the last two weeks due to sluggish demand and the softening of round billet prices. Most Chinese mills, including Anshan Steel, Baotou Steel and others, have decreased their prices of round billets by RMB 50-200/mt ($8-30/mt), giving offers at RMB 5,200-5,350/mt ($660-690/mt) ex-works with 17 percent VAT for July delivery. Domestic seamless pipe prices have gone down by RMB 50-100/mt ($10-15/mt) over the past two weeks, while export quotations of Chinese seamless pipes have decreased by a maximum of $20/mt over the same period. Market players state that the seamless steel pipe market has entered the off-peak season amid the usual rainy weather in summer, due to which many outdoor projects have suspended construction activity. It is thought that it will be hard to see any improvements in the Chinese seamless pipe market in the coming period due to sluggish overseas demand and slack trading activity in the domestic market. Therefore, Chinese seamless pipe prices are likely to go downward amid fluctuations in the period ahead.
Chinese domestic prices of 2"-8" seamless pipes according to GB/8163 are varying at around RMB 5,800-5,900/mt ($900-910/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 6,500-6,700/mt ($1,005-1,035/mt) ex-works.
According to the China Iron and Steel Association (CISA), in May this year China produced 2.231 million mt of seamless pipes, more than April's 2.174 million mt and marking an increase of 7.2 percent year on year. Total production for the first five months of this year was 10.294 million mt, up 12.2 percent over the same period last year.
Current export offers of seamless pipes from Chinese manufacturers for 2"-10" Sch 40 grade B material according to ASTM A106/ASTM A53 are on average at $860-900/mt FOB, 2"-10" Sch 80 seamless pipes are at $890-1,080/mt FOB and 2"-10" Sch 160 seamless pipes are at about $1,070-1,100/mt FOB. Chinese seamless pipes made to ASTM A106/ASTM A53/API 5L are quoted at $960-1,040/mt FOB for 2"-10" Sch 40 and Sch 80 sizes. Export quotations for 2"-4" tubing J55 as per API 5CT, plain ends, are in the range of $1,200-1,230/mt FOB, while quotations for 6"-8" casing are at $1,100-1,130/mt FOB.
According to the China Iron and Steel Association (CISA), China exported 375,983 mt of seamless pipes in May, indicating a decrease of 5.5 percent from the April level but up 15 percent year on year. Exports of seamless pipes from China in the first five months of 2011 reached 1.755 million mt, up 28 percent on the corresponding period of 2010.