Price trend

According to data from SunSirs, the price of seamless tubes slightly increased in July. At the beginning of the month, the quotation for 20 # and 108 * 4.5 seamless tubes was 4,605 RMB/ton, while at the end of the month, it rose to 4,752.5 RMB/ton, an increase of 3.2%, and a year-on-year decrease of 9.39%.

Analysis review

In terms of raw materials, the prices of tube billets stabilized first in July and then slightly increased. In late July, a coal mine accident in Shanxi led to a safety inspection of minerals, which led to a strengthening of coal and coke prices. After the second round of increase in coke prices, the third round of increase started, and the raw materials were running at a high level. Although tubes were purchased according to demand, there was still a strong demand for tube blanks. Therefore, steel mills intended to increase prices, and it is expected that cost support will continue to strengthen.

In terms of demand: The nationwide high temperature weather in July had a significant impact on downstream construction, and the increase in rainfall in the south and north after the onset of the summer season further affected shipping. The release of demand due to high temperature and rainy weather is not expected to be high during the off-season.

In terms of import and export: In June, China exported 446,000 tons of seamless tubes, a decrease of 18.26% month on month and 10.26% year-on-year; From January to June, China exported 2.9975 million tons of seamless tubes, a year-on-year increase of 51.27%. China imported 7,900 tons of seamless tubes, a decrease of 15.05% month on month and 15.96% year-on-year; From January to June, China imported a total of 52,600 tons of seamless tubes, a year-on-year decrease of 23.1%.

As of the end of the month, the inventory of the seamless tube factory was 768,700 tons, a decrease of 7,800 tons compared to last week. The operating rate of seamless tube factories nationwide was 58.2%, which was basically the same as last week.

Market outlook

In summary, in July, seamless tubes stabilized first and prices slightly increased in the late of the month. On the one hand, the news of production restrictions in Tangshan on the 20th, which had been partially confirmed, was bullish on profile and negative for raw materails, and some seamless tube market prices slightly increased. On the other hand, domestic policy meetings had set the tone for economic work in the second half of the year, strengthening market confidence, and the market remained optimistic. However, in the traditional off-season, demand remained weak, and economic meetings and production restriction news had eased the sentiment of poor demand. It is expected that the price of seamless tubes in August may be stronger than in July, but the increase will not be too significant.

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