As of May 12, in China's three main steel markets, i.e., Shanghai, Guangzhou, Beijing, the average price of 20# (GB/T8162-1999) grade 108 mm x 4.5 mm seamless pipe now stands at $910/mt, with 20# (GB/T8163-1999) grade 219 mm x 6 mm seamless pipe at $920/mt; meanwhile, the average price of Q195-215 grade 48 mm x 3.25 mm welded pipe stands at $782/mt, with Q215-235 grade 114 mm x 3.75 mm welded pipe prices at $775/mt. All the above prices include 17 percent VAT.
Seamless pipe prices in China move on stable trend
In the eastern regions of China, seamless pipe prices from Chinese producers have remained almost unchanged over the past week in a context of quite low domestic business activity. Traders have continued to keep their inventories at low levels, and their booking activity has been aimed solely at filling holes in their inventories. In southern China, the current high levels of seamless pipe prices has meant that there has hardly been any transactions in the market. Inventories are slowly being digested as most traders are maintaining a wait-to-see stance towards purchasing activities. Meanwhile, in the northern areas of China, market activity has been slow as nobody wants excessive amounts of inventory. Traders have been obliged to sell off their inventories at negotiated prices in order to relieve the pressure they are under from shortage of funds.
Slightly weak trend and low activity in Chinese welded pipe market
Trading activity in the Chinese welded pipe market has been relatively scarce over the past week. In eastern China, the slight drop in welded pipe prices has been mainly attributed to the decline in feedstock costs. The billet market in Tangshan has seen a drop of $3/mt in price in the past week, in line with which steel strip prices decreased by approximately $4-6/mt. In the southern region of China, the sudden drop in the price of raw materials has caused local buyers to continue to maintain a wait-and-see stance and they have been purchasing only small tonnages for their spot material needs. In northern China, transaction activity for welded pipe products continues to be tepid, as potential buyers are uncertain as regards the future market and are adopting a waiting strategy.