SunSirs: The Seamless Tube Market Fell Slightly Last Week (August 18-22)

Price trend

According to SunSirs’ data, seamless tube prices fell slightly last week. By the end of the week, the price of 20#, 108*4.5 seamless tube was 40,922.5 RMB/ton, down 0.12% from the beginning of the week and down 2.85% year-on-year.

Analysis review

Last week, market prices for tube billets saw a slight decline, with the ex-factory price for 20# hot rolled tube billets at 3,330-3,400 RMB/ton.

Recent meetings failed to signal strong stimulus, leaving the market skeptical about the actual impact of the September production restrictions. Coke prices have undergone their seventh round of price increases, but iron ore and coke prices remained high, providing strong cost support. Losses at tube mills may prompt voluntary production cuts.

As of August 22, there was no obvious improvement in the downstream terminal demand in the market. Although steel mills were actively supporting prices, traders were cautious and were not very motivated to replenish stocks. The start of terminal projects was restricted, and the expectation of suspension of some projects in the Beijing-Tianjin-Hebei region was increasing. In addition, rainfall in many parts of China affected the construction progress. Market transactions continued to be sluggish. Traders had reported that there was a low acceptance of high-priced resources, and the market mainly purchased on demand.

Market outlook

Frequent high temperatures and heavy rain in August limited demand. If demand fails to recover as expected, spot prices may come under further pressure. With September, the traditional peak demand season, approaching, the market remains in a weak adjustment phase, and seamless tube prices will likely continue to be stable and adjust in the short term.

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