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WASHINGTON (June 22, 2020) – According to the American Chemistry Council (ACC), the U.S. Chemical Production Regional Index (U.S. CPRI) fell by 2.0 percent in May following a 2.7 percent decline in April and a 0.9 percent decline in March. During May, chemical output declined across all regions, with the steepest drops in the Midwest and West Coast regions. The lower level of activity is directly related to supply chain disruptions and continued restrictions across much of the country during May.

Designated an essential industry by the U.S. Department of Homeland Security, chemical production continued to ease on a three- month moving average (3MMA) basis, with declines in all segments except plastic resins. Within several major segments, production of some chemical materials increased. These included supply chains tied to PPE and disinfection products.

  U.S. Chemical Regional Production Index

As nearly all manufactured goods are produced using chemistry in some form, manufacturing activity is an important indicator for chemical demand. As restrictions eased in many parts of the U.S., many factories reopened. Overall manufacturing activity was 6.2 percent lower on a 3MMA basis, with declines – in some cases quite steep – across all industry sectors.

Compared with May 2019, U.S. chemical production was off by 6.0 percent, the twelfth consecutive month of year-over-year declines. Chemical production was lower in all regions, with the largest year-ago declines in the West Coast, Ohio Valley and Midwest regions.

Reg-index

The chemistry industry is one of the largest industries in the United States, a $565 billion enterprise. The manufacturing sector is the largest consumer of chemical products, and 96 percent 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 May reflects production activity during March, April and May.

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