Market Overview

Prices held steady in most markets this week, though hidden discounts emerged as Shandong mills trimmed offers by 10-50 RMB/ton. Mill inventories climbed 18k tons weekly, reflecting persistent order pressure amid tepid demand. With supply-demand fundamentals weakening and transactions dominated by low-price deals, seamless pipe prices face downward pressure in the coming week.

Key Market Dynamics

1. Price & Cost Adjustments

• National Average: 4,343 RMB/ton (↓3 RMB/t WoW), masking underlying softness

• Raw Material Divergence: Shandong billets: ↑10 RMB/t WoW; Jiangsu billets: ↓20 RMB/t WoW

• Mill Pricing: Selective cuts (10-50 RMB/t) as demand weakened

2. Profit Pressure Intensifies

• Shandong: -70 RMB/t (↓50 RMB/t WoW) – losses deepen

• Jiangsu: 210 RMB/t (stable WoW) – regional advantage holds

• Structural Strain: Cost disparities push Shandong mills deeper into the red.

3. Inventory Imbalance Worsens

• Social Stocks: 686k tons (↓3.8k tons WoW) – traders destock cautiously

• Mill Stocks: 697.2k tons (↑18k tons WoW) – production exceeds orders

• Pressure Point: Mill inventories up 14.8k tons MoM despite output cuts

4. Supply Adjustment Lags

• Output: 382.8k tons (↓7.5k tons WoW) – modest reduction

• Operational Rates: Capacity utilization: 76.77% (↓1.77% WoW)；Operating rate: 73.27% (↓5.52% WoW)

• Insufficient Correction: Production remains 17.7k tons above 2024 levels

Regional Spotlight: East China

• Shanghai: 4,370 RMB/t

• Nanjing: 4,250 RMB/t

• Hangzhou: 4,350 RMB/t

• Shandong production cuts continued, but inventory kept rising

• Heatwave suppressed demand – transactions dominated by essential purchases

• Traders offered hidden discounts to clear stock

• Outlook: Weakness persists

Next Week Outlook

• Price Trajectory: Softening bias (4,320–4,350 RMB/t range)

• Support Factors: Cost Floor: Shandong billets showing tentative stability；Inventory Control: Traders maintaining lean operations

• Downside Risks: Mill inventory overhang may trigger steeper discounts；Seasonal demand recovery remains elusive

• Key Watchpoint: Jiangsu's profit resilience vs Shandong's deepening crisis