Chinese steel pipe market falls further at the end of August

Overall steel pipe prices in China have continued to decline approaching the end of August.
 
As of August 30, in China's three main steel markets, i.e., Shanghai, Guangzhou and Beijing, the average price of 20# (GB/T8162-1999) grade 108 mm x 4.5 mm seamless pipe now stands at $700/mt, with 20# (GB/T8163-1999) grade 219 mm x 6 mm seamless pipe at $753/mt. Meanwhile, on the same date, Q195-215 grade 48 mm x 3.25 mm welded pipe and Q215-235 grade 114 mm x 3.75 mm welded pipe prices in the above markets are standing at $594/mt and $605/mt. All the above prices include 17 percent VAT.
 
The seamless pipe market in China has moved on a downward trend during the past week. Mills have continued to reduce their quoted price, which has exerted a negative influence on market confidence. Currently, there is a significant volume of inquiries, but the actual trade volume is low. Meanwhile, coming towards the end of August there has been a lot of pressure on traders to collect cash, and so traders have been willing to reduce their prices in order to boost their sales volumes. As for the coming week, it is believed that China's seamless pipe market will continue to decline though by a smaller margin.
 
China's welded pipe market has followed the downward trend of feedstock prices in the past week. Given the lack of support from demand and weak upstream prices, it is believed that there is still room for further downward movement of domestic welded pipe prices. There is also the possibility that traders may try to boost their sales volumes as soon as possible, which could lead to fierce competition in terms of prices. It is thought that welded pipe prices in China may decline by RMB 50-100/mt in the coming week.