US flat rolled price hikes pushed US ERW ASTM A53 black plain end (BPE) standard pipe offers up by about $3.00 cwt. ($66 /mt or $60 /nt) a couple weeks ago, despite pipe demand remaining lethargic and most distributors still trying to lighten their inventories. But as further flat rolled price increases have been accepted in recent weeks, it may be possible for US standard pipes to register yet another increase in the coming weeks.
Domestic hollow structural tubing (HSS) prices increased a total of $4.50 cwt. ($99 /mt or $90 /nt) in June, and are expected to increase by up to another $2.00 cwt. ($44 /mt or $40 /nt) within the next couple weeks, due to rising raw materials costs,(hot rolled coil price hikes). While most ERW BPE standard pipe distributors would welcome any additional price increases, with the weak demand and higher inventories compared to tubing, pipe distributors are not sure that further increases would be able to stick at this point. Demand from standard pipe's main market, construction, remains quite weak and though it may slowly improve as the recession eases, it will be a while before it recovers fully.
Nonetheless, pipe inventories are slowly shrinking, due largely to the lack of import arrivals in recent months. According to the most recent Metal Service Center Institute (MSCI) monthly shipment and inventory report, monthly US pipe and tubing shipments improved from May to June, from 171,000 nt to 183,000 nt respectively, while monthly inventory levels decreased from 662,000 nt in May to 632,000 nt in June. This has resulted in an average inventory overhang of approximately 3.5 months in June, down from 3.9 months in May.
On the import side, while activity remains slow, a few more offers have been seen over the past couple weeks. Still they are not competitive compared to domestic offers and there is very little interest. ERW ASTM A53 galvanized plain end (GPE) standard pipe appears to be the most active import pipe offer to the US, with the most competitive offers coming from India at around $41.00 cwt. to $42.00 cwt. ($904 /mt to $926 mt or $820 /nt to $840 /nt) duty-paid, FOB loaded truck in US Gulf ports. However, Indian mills remain a little more cautious than in the past since they are currently under antidumping review.
Furthermore, ERW BPE standard pipe offers from India can be found for around $35.00 to $36.00 cwt. ($772 /mt to $794 /mt or $700 /nt to $720 /nt) duty-paid, FOB loaded truck in Gulf ports. Meanwhile, Turkish ERW BPE standard pipe offers are hovering around $37.50 cwt. to $38.50 cwt. ($827 /mt or $750 /nt) duty-paid, FOB loaded truck in Gulf ports.
Licensing data from the US Steel Import Monitoring and Analysis System (SIMA) demonstrate that total import tonnage of structural pipe and tube registered its first monthly since January, in June, with 19,279 mt, compared to 18,075 mt in May. Canada and Mexico remained the top two exporters to the US in June, with 14,576 and 3,331 mt respectively. Meanwhile, Turkey recorded only 0.66 mt to the US in June, compared with 1,858 mt in May.