Hot weather impacts demand in Chinese steel pipe market

The Chinese steel pipe market has generally following a stable trend in the past week, while hot weather conditions have impacted demand levels.
 
As of August 1, 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 $694/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 $618/mt and $623/mt. All the above prices include 17 percent VAT.
 
Chinese domestic seamless pipe prices have remained stable during the past week. Although mills have slightly raised their billet prices, seamless pipe producers have kept their prices stable as the hot weather has limited the demand for seamless pipes. Traders still lack optimism on the prospects for the future market trend and so are reluctant to build up their stocks. However, shortages of certain seamless pipe products will provide support for prices. Overall, Chinese domestic seamless pipe prices are expected to maintain their stable trend during the coming week.
 
The local Chinese welded pipe market has mostly moved sideways in the past week. According to traders, slower construction activity due to the hot weather has negatively impacted domestic demand for welded pipes, while traders are not inclined to conclude purchases and build up stocks, but prefer instead to focus mainly on sales. The future trend of the market will continue to depend on the weather. It is thought that domestic welded pipe prices are unlikely to rise given the low levels of demand and weaker steel strip prices. The domestic welded pipe market is expected to mostly maintain its stable trend during the week ahead.