Interpipe OCTG pipe sales surged 2.1x in 11M21

Railway product sales volume at Ukraine’s largest pipe
and railway wheel producer Interpipe (INTHOL) was 14.0 kt in November, a 3.1%
m/m decrease, according to the company’s monthly operational report released on
Dec. 20. Pipe sales skyrocketed 61.1% m/m to 64.0 kt, while external billet
sales added 28.1% m/m to 1.4 kt.

 

The m/m increase in pipe sales in November was driven
by jumps for OCTG pipes to 20.7 kt (2.6x m/m) and line pipes to 35.0 kt (+55.7%
m/m). The OCTG pipe sales jump was almost entirely due to the US market, while
the increase in line pipe sales was due to larger deliveries to Europe, the US
and Middle East, the report said. However, welded pipe sales slid 14.9% m/m to
6.1 kt due to subdued demand in Europe and Ukraine.

 

The m/m drop in railway product sales was driven by
lower sales to the CIS and Europe.

 

During 11M21, Interpipe’s pipe sales added 22.8% yoy
to 522.9 kt, driven by a 110.6% yoy surge for OCTG pipes to 155.7 kt. Line pipe
sales added 12.5% yoy to 292.4 kt, while sales of mechanical pipes advanced
36.1% yoy to 22.3 kt. However, welded pipe sales plunged 30.5% yoy to 52.4 kt
in 11M21.

 

Railway product sales dropped 10.6% yoy to 156.9 kt in
11M21, driven by a 14.9% loss for wheels to 128.7 kt, partially offset by a
23.7% increase for wheelsets to 22.7 kt.

 

Interpipe boosted its external billet sales 64.2% yoy
in 11M21 to 49.7 kt.

 

Ukraine’s share of Interpipe’s pipe sales in 11M21
dropped to 18%, or 4pp less than in 2020. At the same time, the share of sales
in the Americas rose 9pp to 20% and the share of CIS countries gained 1pp to
12%. Europe’s share in pipe sales dropped 4pp to 25% while MENA’s share slid
1pp to 23%

 

The share of Interpipe’s railway product sales in
Ukraine in 11M21 added 1pp from 2020 to 15%, while the share of sales to Europe
retreated 2pp to 33%. The share of sales to CIS countries dropped 5pp to 38%.
The share of sales in the Americas added 3pp to 6%, and sales in other
countries jumped 5pp to 6%.

 

Regarding production volumes, which might be
indicative of sales volumes in the coming months, Interpipe’s pipe production
dropped 7.3% m/m to 52.1 kt in November, and particularly its production of
OCTG pipes plunged 33.7% m/m to 13.0 kt. Its railway product output added 5.9%
m/m to 14.7 kt in November, while steel production jumped 39.1% m/m to 87.7 kt.

 

Dmytro Khoroshun: A m/m jump
in some production and sales volumes in November was expected because of the repairs performed in October.

 

Interpipe’s sales of OCTG pipes might drop m/m in December
because of the drop in their production volumes in November.