Firm prices for iron ore, coal and scrap and the weakness of the euro have encouraged Czech seamless pipe producers to pass on higher costs to customers. Over the past month export quotations of Czech seamless pipes have increased by €60-80/mt ($82-109/mt). However, market players report low buying activity in the European market, while the Middle East and US markets are more active. Market sources also report that ArcelorMittal Ostava is fully booked for February-March production due to the many orders it has received from the US, while its prices are expected to increase by an additional €20-30/mt ($27-41/mt) by the end of February due to higher raw material costs.
Export prices for February production 2"-10" Sch 40 seamless pipes of steel grade B made to ASTM A106/API 5L from ArcelorMittal Ostrava are at €950/mt ($1,294/mt) FCA, offers of 1"-1 ½" seamless pipes are at €1,000-1,070/mt ($1,363-1,458/mt) FCA, while ½"-3/4" seamless pipes are at €1,090-1,100/mt ($1,485-1,498/mt) FCA.
The outlook for the Czech economy in 2011 is moderately optimistic. The risk that recession may return has got much smaller. However, the economic situation in the eurozone and the need to cut the domestic public finance deficit stand in the way of faster economic growth. The eurozone's debt problems may exert a negative impact on the European real economy and thus also on demand for Czech exports.
€1 = $1.362