NEW YORK A jump in the benchmark Pipe Logix oil country tubular goods (OCTG) index for July was likely spurred by the anti-dumping duties assessed on imports from South Korea, Tenaris SAs top North American executive said during an earnings call.
"Its directly related to the notion of the 10- to 15-percent final determination found against Korea," Germán Curá, managing director of North American operations, said July 31.
Chairman and chief executive officer Paolo Rocca reiterated the importance of the index for domestic OCTG pricing. "Pipe Logix is very important for a large part of our sales in the United States. This is something that will be considered in any negotiation," he said, noting that the index also is used as part of formulas for long-term agreements with multinational oil companies.
Tenaris expects dwindling Korean OCTG imports as a result of the duties, which still have to be confirmed by a U.S. International Trade Commission (ITC) injury ruling.
U.S. imports of Korean OCTG totaled 729,028 tonnes in the first six months of this year, according to data from the U.S. Commerce Departments Enforcement and Compliance division.
Rocca said the share of Korean imports in the first half of 2014 "exceeded the share of the largest U.S. producer."
Curá said he was confident the Luxembourg-based pipe and tube marker would be able to increase capacity utilization at its domestic welded operations. Tenaris acquired domestic welded OCTG maker Maverick Tube Corp. in 2006 (amm.com, June 13, 2006).
Meanwhile, Rocca said the company is "on schedule and on budget" at its new seamless OCTG facility in Bay City, Texas (amm.com, Sept. 13).
Tenaris posted net income of $420 million in the second quarter, down 2.3 percent from $430 million in the same period last year on sales that fell 5.9 percent to $2.66 billion, although the companys North American sales increased 8.4 percent to $1.07 billion from $986 million in the same comparison.
In terms of the domestic drilling market, Tenaris does not foresee an imminent return of gas drilling but believes oil shale drilling will continue to increase in the near term.