Price trend

According to statistics from SunSirs, in July, the price of seamless tubes fluctuated and fell. At the beginning of the month, the quotation of 20#, 108*4.5 seamless tube was 5,877.5 RMB/ton, and it fell to 5,245 RMB/ton at the end of the month, down 10.76% and down 15.78% year-on-year.

Analysis review

On the upstream side, in July, iron ore fell slightly by 7.2%. The inventory of raw material tube blanks was slightly high, and it was still in the stage of slight loss, and the tube blanks were also lowered to a certain extent.

In terms of demand, due to the domestic epidemic, foreign geopolitics, and the impact of multiple factors such as the Fed's interest rate hike, the operating rate of construction projects across the country was low, the market demand was lower than expected, the overall supply was oversupply, the price of seamless tubes also showed a lack of upward momentum, and the market appeared to be in a state of "not prosperous in peak season and obvious in off-season". In addition, due to the high temperature in July, the downstream demand was not released as scheduled, and the market transaction was lower than expected.

In July, both seamless tube inventories and operating rates declined.

Market outlook

To sum up, in July, seamless tubes continued the weakness in May and June, and demand remained sluggish. Operating rates and inventories fell this month. In August, with the gradual disappearance of various negative factors and the implementation of the superimposed positive policies, the demand for construction sites may recover. However, August is still a low season, and the increase in demand may be limited. It is expected that the seamless tubeline will be weak and stable in the first half of August. With the advent of the peak season in September, there may be a slight rebound in the second half of August.

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