In June, due to the slowdown of downstream demand release, continued supply release, and the large price increase in the early period, China's seamless steel pipe
prices generally showed a slight downward trend after the surge.
The traditional off-season is approaching, and the demand for seamless steel pipes has dropped as expected. After entering June, the main seamless steel pipe demand areas in China have ushered in the rainy weather, which has affected the construction speed of the construction site, thus weakening the demand for seamless steel pipes for construction. This also means that the demand for building seamless steel pipes is about to enter the traditional off-season.
The spread of foreign epidemics showed no obvious signs of easing, resulting in a substantial drop in net seamless steel pipe exports. April to May is the period when domestic epidemics are under control and the outbreaks of foreign countries are accelerating. The situation at home and abroad has changed. Affected by the epidemic situation, the demand for seamless steel pipes abroad has shrunk sharply, and short-term supply has surplus. At the same time, the country is in an accelerated recovery phase, demand has been steadily released, and prices of seamless steel pipes have continued to rebound after bottoming out. Changes in the prices of seamless steel pipes at home and abroad have not only caused a significant reduction in the domestic export volume of seamless steel pipes, but also a significant increase in the import orders for seamless steel pipes.
The production of China's seamless steel pipe production plants is stable and always maintains a high level of supply. Since domestic steel production enterprises are less affected by the epidemic, the supply end of seamless steel pipes basically maintains a relatively high production level. During the epidemic, affected by the pessimistic expectations of the market, the domestic seamless steel pipe production plant was driven by the reduction of the average cost and maintained full production under the pressure of high inventory. In the later stage of the epidemic, as steel prices stabilized and rebounded, seamless steel pipe production plants continued to maintain full production driven by profits. During the entire epidemic, the supply end of seamless steel pipes was almost unaffected.
The supply-demand relationship of seamless steel pipe stock is gradually changing due to the changes of the above three factors, and the rising kinetic energy of seamless steel pipe futures prices has also weakened. It does not even rule out the market with a certain degree of callback.