The domestic ERW
pipe market is still afloat and is among the stronger steel products during this period of seasonal price declines in the steel industry. However, the standard
pipe market has lost some of its strength in the past month, with prices falling off slightly.
Most domestic offers for A53 now range from $46.00 cwt. to $47.00 cwt. ($1,013 /mt to $1,036 mt or $920 /nt to $940 /nt) ex-mill, down from the $49.00 cwt. to $50.00 cwt. ($1,080 /mt to $1,102 /mt or $980 /nt to $1,000 /nt) range they had been hovering at in November.
Experts say that standard
pipe prices have come down partially from the slow
construction market and seasonal slowdown, though the main problem is high inventories. Even with mills' planned fourth quarter outages taking place, there is still a lot of tonnage on the market. Still, demand is strong enough so that no major price decreases are expected, and prices are expected to remain at the current range for the rest of the year before starting to trend up again in the spring when inventories will be depleted and
construction activity will pick up again.
While the standard
pipe market is sluggish, the market for energy pipes is still robust. The pricing trend for both domestic line
pipe and OCTG remains strong, with strong demand and pricing expected to continue in the New Year. Energy companies are expected to ramp up drilling activity in January, and gas prices are expected to rebound at this time as well. Baker Hughes rig statistics show for the current week, a total of 2,187 rigs in
North America, compared to 2,159 rigs last week, and 2,162 rigs for the same week last year.
Domestic line
pipe offers on the market are currently in the low $50 's cwt.
The import pricing trend for ERW
pipe is still slightly down, as inventories are high and competition between Chinese mills remains fierce, keeping prices from rising. While buyers predict that import OCTG will remain strong, Chinese line
pipe and standard
pipe are still being offered at rates significantly below domestic prices. Though the lower grades of Chinese
pipe are very competitive compared to domestic rates, the US
construction industry, the end user for most standard
pipe, is somewhat protected by the many governmental
construction projects that are required to use domestic
pipe.
For now, Chinese offers for A53 standard
pipe still range from $590 /nt to $630 /nt ($650 /mt to $694 /mt or $29.50 cwt. to $31.50 cwt.) FOB loaded-truck, Houston, Texas. Offers for sizes larger than 8” diameter from
China range from $690 /nt to $730 /nt ($761 /mt to $805 /mt or $34.50 cwt. to $36.50 cwt.) FOB loaded-truck at West and Gulf Coast discharge ports. While larger than 8”
pipe is generally made from hot rolled coils made from slabs, smaller diameter pipes are made from
HRC made from billets.
As of now, Chinese line
pipe (API 5L X42) offers still range from approximately $700 /nt to $750 /nt ($772 /mt to $827 /mt or $35.00 cwt. to $37.50 cwt.) FOB loaded-truck in Houston, with extras for
pipe larger than 8”.
US Steel Import Monitor statistics show that during the month of November, the following countries exported the most standard
pipe to the US:
China, at 50,201 mt;
Canada, at 24,112 mt;
Mexico, at 5,451 mt;
Korea, at 4,570 mt; and
Taiwan, at 3,710 mt.
The most line
pipe imports during the month of November came from the following countries:
China, at 53,599 mt;
Korea, at 31,326 mt;
Canada, at 30,911 mt;
Brazil, at 23,158 mt; and
Japan, at 16,373 mt.