Local Chinese steel pipe prices decline sharply

Local Chinese steel pipe prices have continued to indicate large decreases during the past week.

As of November 29, 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 $706/mt (RMB 4,900/mt), with 20# (GB/T8163-1999) grade 219 mm x 6 mm seamless pipe at $721/mt (RMB 5,007/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 $605/mt (RMB 4,200/mt) and $598/mt (RMB 4,153/mt) respectively. All the above prices include 16 percent VAT.

Trading activity has been at low levels in the local Chinese seamless pipe market where prices have declined by large margins during the past week under the influence of the significant decreases in prices of billet and other raw materials. Traders of seamless pipes are mostly pessimistic and are willing to reduce their quotations in order to close more deals. As for the week ahead, it is believed that seamless pipe market prices may continue their downward trend.

Trading activity has also been weak in the Chinese domestic welded pipe market where prices have declined sharply in the past seven days, mainly due to the large decreases in steel strip prices. Traders are willing to reduce prices in order to boost their sales. As for the week ahead, domestic welded pipe prices are expected to soften further.

16 percent VAT is included in all prices and all prices are ex-warehouse.

$1 = RMB 6.93