Page 14 - ITAtube Journal 1 2019

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Market information
Fig.13: World steel pipe production in Ttons (seamless) Source: ITATube Journal/Wirtschaftsvereinigung Stahlrohre e.V.
In 2017 the euro (EUR) gained about 20% against the US dollar (USD). (Fig.18) In the months since April 2018, it fell again by about 10%, down to 1.13 in October 2018. This does, of course, lessen pressure on exports into the US.
At the same time, in 2017 the exchange rate of the euro to the Chinese yuan (CYN) gained about 9.5%. In mid-2018, however, the currency fell back by some 7.4%. Since then it has levelled out at about 7.8 yuan/euro. The range of movement in 2018 was relatively even at ±3%, allowing for stable business conditions.
The value of the euro against the Russian rouble (RUB) has gained some 28% since April 2017 and is now at a level of about 75 roubles/euro. This has meant that local pipe producers to a large extent served the home market, to compensate for export losses due to higher exchange rate costs. (Fig.19)
From January 2017 (4.0) to Feb- ruary 2018 (4.7), the exchange rate of the euro to the Saudi Arabian riyal (SAR) gained about 15%. Since then it has dropped back some 11%, standing at 4.25 riyals/euro as of January 27, 2019. Overall, since 2017, imports to Saudi Arabia from Europe have become about 4% more expensive.
What measures are pipe produc- ers and plant equipment suppliers taking to overcome current diffi- culties and to generate sustaina- ble business?
The global increase in tube and pipe demand is leading to region- ally improved plant utilization in the steel tube industry. Some pipe producing companies in the US are even reactivating obsolete
Fig.14: World steel pipe production in Ttons (seamless) Source: ITATube Journal/Wirtschaftsvereinigung Stahlrohre e.V.
Fig.15: World steel pipe production in Ttons (welded < 406 mm OD) Source: ITATube Journal/Wirtschaftsvereinigung Stahlrohre e.V.
pipe imports to protect US line pipe producers – a political signal which seems to be having the desired effect. The extrapolated Q3 2018 figures (Fig.17) show this impressively. US (+13%), CIS (+9%) and EU (+2%) gains are offset by losses for China (-15%) and Japan (-6%).
This trend reflects the decreased demand for pipelines in these regions, as well as the effect of
political measures taken by some parties. Some technologically advanced producers of large diam- eter line pipe tubes have none- theless flourished on the merits of their unique selling points.
In the current scenario, currency exchange rates have also had a notable impact on tube and pipe industry exports – both prod- ucts and manufacturing plant – throughout the world.
ITAtube Journal No1/February 2019