Overcapacity continues to be the greatest hindrance when it comes to stabilizing prices in the US domestic API X-42 electric resistance welded (ERW) line pipe market. Rig counts have been recovering in the past few weeks, but at a very slow and steady pace, and not fast or consistently enough to absorb the amount of pipe saturating the market. The most recent data from Baker Hughes indicates that the number of rigs drilling for oil increased by 10 last week, bringing the total to 1,381. That having been said, although the most commonly reported spot transaction range is unchanged in the past week at $54.00-$55.00 cwt. ($1,191-$1,212/mt or $1,080-$1,100/nt) ex-mill, deals as much as $3.00-$5.00 cwt. ($66-$110/mt or $60-$100/nt) below the average range can be negotiated on larger orders.
Looking offshore, prices for import API X-42 ERW line pipe from Korean, Taiwanese, Vietnamese and Turkish mills have declined in the past week. Order activity and inquiries are lackluster yet stable, and many traders have enough inventory on hand and are not looking to take on additional position tons. Although sales prices from all for countries in the US have narrowed by approximately $0.50 cwt. ($11/mt or $10/nt) on the high end in the past week, now at $54.00-$54.50 ($1,191-$1,202/mt or $870-$880/nt), the offshore mills have not been opposed to deals $2.00-$3.00 cwt. ($44-$66/mt or $40-$60/nt) under the range for higher volume orders.