Mysteel Weekly: Mill Inventories Rise – Seamless Pipe Prices May Stabilize with Weak Bias Next Week (Apr 4–11)

Overview
Steel futures rebounded this week as markets digested macro developments. Globally, the U.S. paused tariffs on select nations (Nasdaq +12%), while China hiked tariffs on U.S. goods to 125%. U.S. March ADP employment rose by 155,000 (vs. 115,000 expected). Domestically, the central bank injected RMB 28.5 billion via a 7-day reverse repo at 1.50%. Seamless pipe prices fell RMB 29/ton WoW amid mixed demand recovery.

Weekly Review

Price Trends

• Seamless Pipes: National average price for 108*4.5mm pipes dropped to RMB 4,358/ton (-29/ton WoW), with widespread regional declines.

• Raw Materials: Shandong pipe billets fell RMB 40/ton WoW, while Jiangsu prices dipped RMB 20/ton, widening the regional gap.

• Mill Adjustments: 34 surveyed mills cut prices by RMB 20–50/ton.

Profit Analysis

• Shandong Mills: Losses held at -RMB 40/ton (flat WoW).

• Jiangsu Mills: Profits rose to RMB 290/ton (+50/ton WoW) as costs eased.

East China Market

Shandong pipe billet prices fluctuated (-30–40/ton WoW), with mills prioritizing discounts. Weak demand may prolong price declines.

Inventory Dynamics

• Social Stocks: Fell 2,300 tons WoW to 700,900 tons.

• Mill Stocks: Rose 5,200 tons WoW to 602,500 tons, signaling weaker orders.

• Production: Output edged up to 368,300 tons (+1,800 tons WoW), with capacity utilization at 80.03%.

Market Forecast

• Price Outlook: Cost-driven declines persist, but futures strength may limit downside.

• Fundamentals: Rising mill inventories clash with sluggish demand, pressuring traders to prioritize destocking.

• Sentiment: Cautious restocking dominates amid tariff uncertainties and competitive pricing.

Conclusion: Seamless pipe prices are expected to stabilize with a weak bias next week, supported by limited demand recovery and soft cost trends.