Slack demand in local Chinese steel pipe market ahead of holiday

Prices in the local Chinese steel pipe market have either moved sideways or indicated slight changes during the past week.

As of September 27, 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 $795/mt (RMB 5,467/mt), with 20# (GB/T8163-1999) grade 219 mm x 6 mm seamless pipe at $812/mt (RMB 5,583/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 $695/mt (RMB 4,783/mt) and $687/mt (RMB 4,727/mt) respectively. All the above prices include 16 percent VAT.

During the past seven days, local Chinese seamless pipe prices have been mostly stable, though with some slight upticks seen in certain markets due to low inventory levels. Overall trading activity has remained slack on account of the approach of the National Day holiday. As for the coming week, it is believed that domestic seamless pipe prices may remain stable before and during the holiday and may rise slightly after the holiday is over.

Chinese domestic welded pipe prices have softened slightly during the past week amid low trading activity and slight decreases in upstream steel strip prices. The demand side has been negatively influenced by bad weather conditions and the upcoming National Day holiday. However, traders are mostly upbeat on the prospects for demand after the holiday. Accordingly, it is believed that the slight downtrend in the market before the holiday will be replaced by minor upticks in prices after the holiday.

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

$1 = RMB 6.88