Mysteel Weekly: Cooling Market Activity – Seamless Pipe Prices May Consolidate with Weak Bias Next Week (May 6–13)

Overview：Steel and pipe billet prices rose this week, but transaction growth slowed. Shandong mills saw slight profit improvements and inventory reductions, though demand remains muted. By May 16, the national average seamless pipe price edged up RMB 9/ton, reflecting cautious optimism.

Price Trends：

• National average price for 108*4.5mm seamless pipes rose 9 RMB/ton to 4,341 RMB/ton, with mixed regional adjustments.

• Raw Materials: Shandong pipe billets held steady, while Jiangsu billets stabilized after recent gains.

• Mill Adjustments: Some mills raised prices by 20–50 RMB/ton to pass on cost pressures.

Profit Shifts:

• Shandong Mills: Profits improved to 10 RMB/ton (+20 RMB/ton weekly), though margins remain fragile.

• Jiangsu Mills: Profits held at 100 RMB/ton, reflecting stable pricing discipline.

Inventory & Supply: Slight Relief but Risks Linger

• Social Inventories: Fell to 699,600 tons (-13,800 tons weekly), led by East China (-11,500 tons).

• Factory Stocks: Declined to 626,400 tons (-6,600 tons weekly), but remained 19,800 tons higher YoY.

• Production: Output dipped marginally to 369,500 tons/week (-300 tons weekly), with capacity utilization at 80.29%.

Takeaway: While inventories eased, high YoY stockpiles and stagnant demand signal underlying fragility.

Regional Focus: East China’s Uneven Recovery

• Shandong & Jiangsu: Pipe billet prices rose 30 RMB/ton, prompting mills to hike offers by 30–50 RMB/ton.

Key Cities:

• Shanghai: Prices dipped 10 RMB/ton on weak trades.

• Hangzhou: Gained 20 RMB/ton due to sporadic restocking.

• Nanjing: Prices flatlined as buyers resisted higher offers.

Outlook: Prices may drift lower as tepid demand outweighs cost support.

Demand Dynamics: Early Gains Fizzle Out

• May Sales: Demand improved early in the month but slowed sharply by mid-May.

• Weather Impact: Southern rains began disrupting construction, while northern markets showed modest resilience.

• Sentiment: Traders remain cautious, prioritizing inventory turnover over speculative buying.

Next Week’s Forecast: Weakness Looms

Price Drivers:

• Cost Support: Stable billet prices may delay steep declines.

• Demand Erosion: Southern monsoon and fading restocking momentum.

• Policy Void: No fresh stimulus to revive buyer confidence.

Key Risks:

• Prolonged rainfall in the Yangtze River Delta.

• Black futures (e.g., rebar) resuming downtrend.

Outlook: Seamless pipe prices are expected to trend weakly, with regional divergences widening.