Buyers and sellers of US domestic and import API X52 line pipe continue to report high levels of frustration due to a lack of market clarity, which is tied to ongoing indecision within the Trump administration with regard to trade policy.
“I’ve never seen so many experienced people who don’t know what to say to me,” a Midwest-based source said. “My dad has been involved in this business for decades, and even he’s at a loss for words.”
That sentiment is resonating throughout the market.
“This whole situation is impossible. Customers can’t budget because people don’t know where things stand, and they have no idea what their price will be by the time their steel get here,” another source said.
“The last two weeks have created havoc. When Trump said Mexico would be exempt from the 25 percent tariff we went out and bought a lot of Mexican pipe because we thought we were getting a deal, but then administration reversed course and said the tariff exemptions would only be good until May 1, and our delivery will be after that. At this point we’re assuming the worst and we’ve let our customers know to prepare for the worst-case scenario, which is that their costs will be 25 percent higher than they planned.”
Others point out that there is still a lot of confusion with regard to South Korean pipe; the latest development in trade policy is that South Korea will continue to be able to ship, without the tariff, but they’ll need to reduce steel shipments to the US by 30 percent.
“There’s still a lot of confusion in terms of how the quotas will be divided, and who is in charge of policing that,” another source said. “The [Korean] mills we work with said they’re not quoting anything until they figure out what’s going on.”
In terms of current US pricing for API-X52 line pipe, sources say that in the current week, domestic mills are quoting at $70.00-$72.50 cwt. ($1543-$1598/mt or $1400-$1450/nt), ex-mill.
Import price points are currently uncertain and remain under evaluation.