The pricing downtrend within the US domestic API X52 line pipe market has continued. This week, sources close to SteelOrbis have indicated that while recent deals at $50 cwt. ($1,102/mt or $1,000/nt) had only been available to volume buyers, transactions below that price point have now become the norm.
Some buyers have reported concluding deals at price points “as low as $45 cwt. ($992/mt or $900/nt), ex-mill. Based on demand and other things that are going on in the market, I think things could shift even lower than that,” a source said, noting that most transactions today are taking place between $45-$48 cwt. ($992-$1,058/mt or $900-$960/nt), ex-mill. “Service centers that need cash flow are liquidating stock. Buyers haven’t needed to wait to the end of the year to get fire-sale prices.”
Lagging activity out of the oil patch hasn’t helped. Earlier today, Baker Hughes reported that the number of active US rigs drilling for oil had fallen for the fifth consecutive week. This week’s tally of 770 rigs is six rigs fewer than levels recorded seven days ago. “Soft rig counts coupled with marginal demand has been the Achilles heel for pipe prices,” a source concluded.