Oversupply Concern for Welded Steel Pipe Dealers’ Market in Tokyo

Welded steel pipe supply is expected to get easier in the dealers’ market around Tokyo though the makers try to improve the supply balance by reducing the order receipt in April-June. The dealers’ shipment decreases since July while some sizes are still thin in their inventory. The dealers are cautious the supply balance could impact on the price toward the demand season.

The welded pipe makers try to secure the material hot rolled coil from steel makers at home and abroad under worldwide tight supply. Domestic welded pipe supply was very tight in April-June when some makers reduced the supply due to limited availability of hot coil.

However, the pipe demand for construction decreases recently due to slower economy while the demand is still firm for automobile industry. The shipment of the dealers, which serve mainly for construction industry, decreases recently. A dealer source said the supply gets easier in the distributors’ market despite of the lower supply from the makers.

The market price already reflects price hike by the makers for July shipment. The dealers’ reselling price hit record around Tokyo. However, the higher pipe and steel price results in lower demand when developers and general contractors cancel and revise some the building plan.

The welded pipe makers already reduce the supply for the dealers and contract users. However, the makers should reduce the supply more depending on the demand condition toward autumn.