Welded pipe prices in China have indicated a slowdown in their increasing trend over the past two weeks as the panic caused by China's clampdown on energy consumption has diminished somewhat. Domestic quotations of welded pipes in China have increased by RMB 100-200/mt ($25-40/mt) over the past two weeks, while export prices have moved up by a maximum of $10/mt in the same period. September is always the traditional boom season in China for construction, characterized by strong demand for steel products and declining inventories. Thus, it is predicted that prices will remain at a high level in the coming weeks. Nevertheless, some traders think that the latest round of price hikes has mainly been influenced by the national power rationing policy, and not driven by real demand. Meanwhile, the potential cut in supply and the construction of affordable houses combined with the recovery of the overall property market in China should help the welded pipe market to improve in general. In this context, the Chinese welded pipe market is unlikely to rise by a great extent in the coming months but should see some modest increases.
Current offers of locally produced welded pipes, 2"-6" Q215-Q235 grade, are being given to the domestic market at an average of RMB 4,650-4,800/mt ($690-715/mt) ex-works. These local market prices include 17 percent VAT. Domestic prices of ERW pipes of grade B made to ASTM A53/API 5L are at around RMB 5,300-5,500/mt ($790-820/mt) ex-works.
According to the China Iron and Steel Association (CISA), in August China produced 2.934 million mt of welded pipes, less than July's 2.99 million mt and marking a decrease of 1.5 percent year on year. Meanwhile, China's welded pipe production in the first eight months of this year reached 21.763 million mt, up 12.4 percent on the corresponding period of last year.
Current export prices of Chinese welded pipes, 2"-6" grade B according to ASTM A53, are varying at around $780-820/mt FOB on actual weight basis.