USA: Market Report U.S. Chemical Production Increases Slightly in January: ACC
According to a report by the American Chemistry Council, the U.S. Chemical Production Regional Index edged higher by 0.1 per cent at the beginning of the year. On a 3MMA basis, manufacturing activity rose by 0.3 per cent in January, added the report.
Washington/USA – According to the American Chemistry Council (ACC), the U.S. Chemical Production Regional Index (U.S. CPRI) edged higher by 0.1 per cent in January following a 0.1 per cent decline in December and a 0.2 per cent decline in November. During January, chemical output declined across all regions except the Gulf Coast.
Chemical production was mixed over the three-month period. There were gains in the three-month moving average (3MMA) output trend of organic chemicals, plastic resins, chlor-alkali, industrial gases, synthetic dyes and pigments, other inorganic chemicals, synthetic rubber, manufactured fibers, and fertilisers. These gains were offset by declines in the output of coatings, adhesives, other specialty chemicals, crop protection chemicals, and consumer products.
Nearly all manufactured goods are produced using chemistry in some form. Thus, manufacturing activity is an important indicator for chemical production. On a 3MMA basis, manufacturing activity rose by 0.3 per cent in January, a second consecutive increase following three months of declines. Output expanded in several chemistry-intensive manufacturing industries, including food and beverages, appliances, motor vehicles, construction supplies, computers and electronics, semiconductors, refining, iron and steel products, foundries, oil and gas extraction, plastic products, rubber products, paper, printing, and furniture.
Compared with January 2019, U.S. chemical production was off by 1.6 per cent on a year-over-year (Y/Y) basis, the eighth consecutive month of Y/Y declines. Chemical production was lower than a year ago in all regions, with the largest declines in the Mid-Atlantic, Northeast, and Ohio Valley regions.
The chemistry industry is one of the largest industries in the United States, a 553 billion dollar enterprise. The manufacturing sector is the largest consumer of chemical products, and 96 per cent of manufactured goods are touched by chemistry. The U.S. CPRI was developed to track chemical production activity in seven regions of the United States. The U.S. CPRI is based on information from the Federal Reserve, and as such, includes monthly revisions as published by the Federal Reserve. To smooth month-to-month fluctuations, the U.S. CPRI is measured using a three-month moving average. Thus, the reading in January reflects production activity during November, December, and January.