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Downtrend still prevails in Saudi Arabian seamless pipe market

Thursday, 09 July 2009 11:28:24 (GMT+3) |

As is well known, the Kingdom of Saudi Arabia is the world's largest producer and exporter of oil and, as a result, Saudi Arabia is a big importer of seamless pipes for the oil industry. Oil accounts for more than 90 percent of exports and nearly 75 percent of government revenues. However, Saudi Arabia's oil minister has lately predicted a drop in petroleum production because demand from buyers is lower than the volumes of oil being produced. Imports of seamless pipes for the first five months of this year decreased to 42,166 mt comparing to 197,184 mt for the same period of last year. Import prices of seamless pipes dropped by $10-50/mt over the past month, with just the Chinese suppliers increasing their seamless pipe prices by $20/mt on average because of the increase in billet prices in the Chinese market.

The current situation in the seamless pipe market in Saudi Arabia is complicated because of the seasonal slump in demand and the approaching of the month of Ramadan. Market insiders do not expect an improvement in the demand level for seamless steel pipes before October-November. Until then the market is likely to remain sluggish.

Import offers of Chinese seamless pipes 2"-6" grade B made to ASTM A106/API 5L are being given to the local market in Saudi Arabia at $720-780/mt C&F.

Ukrainian seamless pipes (Interpipe) 2"-6" grade B as per ASTM A106/API 5L are being offering to the Saudi market on average at $800-820/mt C&F, while 8"-12" pipes are at $830-890/mt C&F.

Quotations of Russian seamless pipes (Volzhsky Pipe Plant, TMK) below 16" grade B made to ASTM A106/API 5L are at $790-850/mt C&F.

Romanian and South African seamless pipes (Arcelor Mittal) 2"-12" grade B made to API 5L are quoted at around $1,100/mt C&F.

Quotations of seamless pipes from Italy (Tenaris), France and Germany (V&M) and from Japan (Sumitomo) 2"-6" grade B made to ASTM A106/API 5L are at about $1,500-1,550/mt C&F, offers of 8"-10"pipes are at $1,600-1,650/mt C&F, and 12"-14" pipes are at $1,700-1,750/mt C&F.