RESEARCH: Seamless pipe price rise continues in most markets

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The seamless pipe market continued its rise over the past month across most products and geographies. Sharp price increases of $135-140 per tonne were seen for oil country tubular goods (OCTG) and line pipe in the United States. In Europe and in the Middle East, increases were more modest, with the exception of a few products such as commodity-grade line pipe in Europe, which rose by €135 ($173) per tonne.

China’s exports slow
China’s seaborne prices did not follow global markets up this past month. In fact, most prices remained substantially unchanged, with the exception of line pipe grade X65, which lost $99 per tonne, partially reversing a $265-per-tonne surge in May that followed the announcement of export rebate cuts.

US rally to continue
Seamless prices are forecast to be supported into the third quarter of this year and then gradually moderate in the fourth quarter. Steel and raw materials costs will recede modestly in the second half of the year, giving room for OCTG producers to make competitive offers against imports.

Extremely high prices for electric-resistance welded (ERW) OCTG will enable seamless alternatives to continue to gain market share well into 2022.

Europe continues to follow scrap
European prices continued to largely follow scrap costs across most products because demand has been limited, but mills have been unwilling to cut margins further. But there are some exceptions. Commodity-grade line pipe rose rapidly thanks to a buoyant mechanical pipe market. Meanwhile, for a higher-margin product such as OCTG L80 with premium connection, there was no room to increase offers further this month.

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