Favorable Factors:
1. Tangshan Ruifeng strip steel 685-885mm at CNY 3,285/MT; prices stable WoW
2. RMB/USD rate holding at 6.77-6.82 band; currency volatility limited
3. SE Asia demand sustained; Vietnam and Indonesia procurement active
4. Infrastructure investment continues; national pipeline projects on track
5. Steel mills production discipline; blast furnace capacity utilization stable
Adverse Factors:
1. China steel pipe export license requirement effective Jan 2026; compliance costs rising
2. EU CBAM carbon certificates at EUR 75/t CO2; ERW exports to Europe unviable
3. US tariff uncertainty persists; buyers adopting wait-and-see stance
4. Property sector continues contraction; new construction starts down 15%+ YoY
5. High raw material inventory across supply chain; restocking momentum weak
Outlook:
ERW pipe FOB prices likely to consolidate in $580-590/MT range. Strip steel costs provide floor support, but demand recovery remains elusive. Competition intensifying in SE Asia market as Chinese mills compete for orders. Focus on Africa and Middle East markets for better margins.
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