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Pipe demand picking up; margins still thin

Keywords: Tags  Metals Service Center Institute, MSCI, pipe and tube, Thorsten Schier

LONDON — Some pipe and tube distributors have seen an uptick in demand so far this month, continuing gains seen in August shipments, but margins remain thin.

"Activity does appear to be picking up, but the battle that we’re fighting is the same one that everyone else is fighting as well. Margins are very slim and it’s very, very competitive," according to one Midwest distributor.

"Selling is extremely competitive," a second Midwest source said, adding that the traditional year-end demand slowdown looms. "Before you know it, we’re going to be in the winter and then we get into the ‘let’s do it next year’ scenario."

U.S. distributors’ carbon pipe and tube shipments totaled 242,000 tons in August, up 4.1 percent from 232,500 in July, while inventories increased 3.7 percent to 706,900 tons (2.9 months’ supply) from 681,700 tons (2.9 months’ supply), according to the latest Metal Service Center Institute data.

Canadian distributors shipped 51,700 tons of pipe and tube in August, up 3.6 percent from 49,900 tons the previous month, while inventories dipped 1.5 percent to 128,300 tons (2.5 months’ supply) from 130,300 tons (2.6 months’ supply).

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