Welded pipe prices switch to uptrend in China

Welded pipe prices have started to increase in the Chinese market for the first time after a long-run decline in the past months, stimulated by the newly approved infrastructure projects by the National Development and Reform Commission (NDRC). Although foreign buyers still show low interest in Chinese welded pipes, export offers have also increased in line with stronger domestic prices and higher raw material costs.
 
Accordingly, Chinese welded pipe producers have increased their domestic prices by RMB 100-200/mt ($16-32/mt) over the past two weeks, while their export offers have moved up by $20-40/mt.
 
Meanwhile, welded pipe prices are unlikely to see significant adjustment in the near term. The construction of most planned projects will last for four to five years, which would mean a little impact on downstream demand. It is thought that the market needs greater support from government policies and the recovery of downstream demand to sustain the upticks in the market.
 
Current offers of locally produced welded pipes, 2"-6" Q215-Q235 grade, are being given to the Chinese domestic market at an average of RMB 3,200-3,500/mt ($505-552/mt) ex-works, while 2"-6" welded pipes of grade B as per ASTM A53 are at RMB 4,000-4,200/mt ($631-663/mt) ex-works. These local market welded pipe prices include 17 percent VAT.
 
Current export prices of welded pipes from large mills, 2"-10" grade B according to ASTM A53, are varying at around $620-700/mt FOB on actual weight basis.