NEW YORK U.S. imports of oil country tubular goods (OCTG) from South Korea will likely remain high as some mills ship more material ahead of a possible trade case.
"Theyre going to bring more in February; theyre going to bring more in March. Theyll bring it here and start selling from here," one trader said, noting that Januarys import license applications for OCTG from Korea97,817 tonnes, according to the U.S. Commerce Departments Import Administrationwere the highest in more than a year despite no noticeable pickup in demand.
"Nothing happened in January, I guarantee you. Its all speculation," he said.
Sources told AMM in January that some Korean mills had acknowledged they were on high alert for a trade case (amm.com, Jan. 16).
A second trader expressed surprise at the rising imports when talk of a trade complaint is rife. "Either they dont give a damn or theyve concluded that the dumping suit is going to be filed anyway and they might as well flood the market," he said.
License applications for imports of Korean OCTG in the first eight days of February totaled 39,516 tonnes at an average value of $938 per tonne, down 3.4 percent from $971 per tonne in January, Commerce figures show.
"I really feel that if there isnt a dumping case, theres going to be a world of hurt," a third trader said.
The rising imports from Korea come as the number of drill rigs operating in the United States declined by five last week to 1,759, according to Houston-based oilfield services firm Baker Hughes Inc., which sources attributed to a lull in exploration activity as the market repositions itself to drill for oil rather than low-priced natural gas.
"Theres a lot of movement between leases, (a) lot of movement between locations," the first trader said. "The rigs are doing some verticals just so they can carry on their lease rather than actually do(ing) production."