Demand still fails to shine in local Chinese steel pipe market

As of September 12, 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 $735/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 $622/mt and $632/mt. All the above prices include 17 percent VAT.
 
China's domestic seamless pipe market has mostly followed a stable trend during the past week, while the trading volume in the market has improved compared to the previous week. However, the increase in demand is not as strong as expected, while prices of billet and other raw materials have been characterized by weakness, and so sentiment among traders has been negatively impacted. For the coming week, it is thought that the Chinese domestic seamless pipe market will just see minor fluctuations, with some slight downticks also possible.
 
The local Chinese welded pipe market has been mainly stable during the past week, though small downticks have also been observed. In particular, decreases in steel strip prices have had a negative influence on the market. Meanwhile, amid low demand, some traders have slightly reduced their prices in order to attract more business. Current costs are considered to be at high levels, while profit margins are low, and so there does not appear to be much room for further decreases in the welded pipe market. If prices of steel strip and other construction materials continue to go down in the coming week, then domestic welded pipe prices are also likely to decline, though by a small margin.