API line pipe sector maintains positive outlook

The medium-term outlook for the API line pipe sector remains positive, despite delays and setbacks experienced by the industry in early 2024.  

Globally, many new oil and gas pipeline projects remain in the planning stages, with several of those due to be announced or expected to receive approvals before 2030. This is despite the oil and gas industry’s growing shift towards low-carbon alternatives. The current oil price supports the continued development investments. 

Most pipemakers reported a disappointing first half of 2024 in terms of confirmed orders, but the volume of enquiries from OEMs remains encouraging for future projects, especially those due to be awarded in 2025 and beyond. MEPS respondents report a growing number of enquiries for carbon dioxide transmission pipelines in the United States, Canada, the United Kingdom and other parts of Europe. 

Nevertheless, demand for API coils and plates was lower than expected in the first six months of this year.  

European plate mills, in particular, faced much lower bookings than anticipated due to project delays, resulting in production capacity remaining available for this year. Buyers report delivery lead times of six to seven weeks.  

European X60/X65 hot rolled plate selling values decreased during the April/June period, reaching what most MEPS sources believe is the bottom of the current cycle. While Asian import offers for API hot rolled plate are comparable to European prices, high container costs and shipping delays make them less attractive to buyers.  

In Asia, X60/X65 hot rolled plate prices fell marginally quarter-on-quarter but remain on par with European prices in euro terms. Several plate-producing steelmakers in the region are still offering September/October delivery lead times for API material. API hot rolled coil prices also declined quarter-on-quarter.