Cost of steel pipe

For businesses, cost matters.
On a month-on-month basis, the PPI rose 2.5 percent in October, up 1.3 percentage points from the previous month, the data showed. Prices of means of production rose by 3.3 percent, or 1.8 percentage points. The price of living materials rose 0.1 percent from flat. In Zhao Wei’s view, commodities are still the key to the rise in PPI. Due to the intertwining of imported factors and the tight supply of some domestic raw materials, the prices of crude oil, black and mild steel tube increased significantly.

Data show that the fluctuation of international crude oil prices has increased, driving up the price of domestic oil-related industries. Among them, oil extraction industry prices rose 7.1%, refined petroleum products manufacturing prices rose 5.8%, and led the middle and downstream chemical manufacturing, chemical fiber rose 6.1% and 3.5% respectively, four industries affected PPI rose about 0.76 percentage points.

At the same time, coal mining and coal processing increased by 20.1% and 12.8% respectively, with a total impact of 0.74 percentage points. The prices of products in some rectangular hollow section increased, the prices of non-metallic mineral products increased by 6.9%, the prices of non-ferrous metal smelting and rolling processing industries increased by 3.6%, and the prices of black metal smelting and rolling processing industries increased by 3.5%. The above three industries together affected the PPI by about 0.81 percentage points. On a year-on-year basis, PPI growth was even more rapid, reaching 13.5%, up 2.8 percentage points from the previous month. Prices rose in 36 of the 40 industrial sectors surveyed.

Prices means of production of black iron steel pipe rose by 17.9 percent, or 3.7 percentage points. The price of living materials rose 0.6 percent, up 0.2 percentage points. Eight industries, including oil and gas mining industry, black metal smelting and rolling processing industry, non-ferrous metal smelting and rolling processing industry, all rose between 12.0% and 59.7%, expanding by 3.2-16.1 percentage points. In total, PPI rose by about 11.38 percentage points, more than 80% of the total increase.

The carry-over effect of last year’s price changes was estimated to be about 1.8 percentage points of October’s 13.5% year-on-year increase, the same as the previous month; The impact of the new price increase was about 11.7 percentage points, up 2.8 percentage points from the previous month. Due to the gap between supply and demand of thinner wall steel pipe, the prices of some globally priced goods are easy to go up and down, and PPI may still be above 5% in the next two quarters. With the easing of the contradiction between domestic supply and demand, the decline of PPI tends to accelerate, and deflation will enter at the end of next year.