Pricing for domestically produced OCTG in the US has strengthened for the first time in nine months, Kallanish hears from market participants. 

Prices of welded P110 5.5-inch domestic casing have increased this week to $1,650-1,700/short ton, from $1,600-1,700/st, where the range had stagnated for 11 weeks.

The milestone demonstrates that the OCTG market may be showing modest signs of recovery after slipping steadily, without a weekly increase, since January. Sources contend that demand heightened this week as the result of service centres being at the end of their on-hand inventory. Further, there is speculation of preparatory purchasing because of fear of delays caused by the longshoremen's strike affecting the Gulf of Mexico ports (see Kallanish passim).

One Gulf Coast distributor explains that customers are finally selling through months of their backlog inventory.

“Sales have been steady this week. Lots of customers have called us asking whether they’ll be OK with the strike. They are selling through their inventory and since P110 has such a long lead time, they are wondering if they need to place orders now,” says that distributor.

A different Texas-based distributor explains that mill excesses of P110 have been sold gradually the year. Buyers may be beginning to feel more confident about purchasing inventory as the bottom may be over. 

“Customers are concerned. If things drag on, I think our customers will start to do more panic buying. Now they are make purchases in line with what they expect to sell and probably a little more for stock,” contends the second distributor. 

In the equivalent week of 2023, P110 5.5-inch casing transaction prices were in a range of $1,900-2,000/st.

All prices are ex-works domestic mill.