The Chinese seamless pipe market has continued to weaken. Transactions in the domestic market are scarce, while demand from foreign buyers also remains sluggish amid the current global economic uncertainty. Over the past two weeks, Chinese suppliers have decreased their domestic quotations by RMB 50-200/mt ($5-25/mt), while export offers have gone down by $20-30/mt. Market insiders express pessimism as regards the prospects for the future market given the current high inventory levels and the central government's tight monetary policy. Export activity will also remain weak in the current grim international economic climate. Meanwhile, raw material prices might further decline, providing less support for seamless pipe prices.
Chinese domestic prices of 2"-8" seamless pipes according to GB/8163 are varying at around RMB 5,500-5,700/mt ($865-895/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 6,200-6,400/mt ($975-1,005/mt) ex-works.
According to the China Iron and Steel Association (CISA), in September this year China produced 2.232 million mt of seamless pipes, less than August's 2.326 million mt but marking an increase of 7.4 percent year on year. Total production for the first nine months of this year was 19.56 million mt, up 10.7 percent over the same period last year.
Current export offers of seamless pipes from Chinese manufacturers for 2"-12" grade B material according to ASTM A106/ASTM A53/API 5L are on average at $900-980/mt FOB, while 14"-24" seamless pipes are at about $1,000-1,050/mt FOB.
Export quotations for 4 ½"-13 3/8" casing, J55 as per API 5CT, plain ends, are at $1,100-1,150/mt FOB, while 2 7/8"-3 1/2" tubing, plain ends, are at around $1,150-1,200/mt FOB.
According to the China Iron and Steel Association (CISA), China exported 422,473 mt of seamless pipes in September, indicating a decrease of 8.7 percent from the August level and up 27.6 percent year on year. Exports of seamless pipes from China in the first nine months of 2011 reached 3.485 million mt, up 24.5 percent on the corresponding period of 2010.