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Chemical Production Regional Index

U.S. Chemical Manufacturing Closed the Year Lower

U.S. chemical production closed the year with a pronounced decline, falling 0.9% in December after a 0.3% drop in November, according to new data from the American Chemistry Council (ACC).

“The U.S. chemical industry ended the year weaker,” said David Lan, ACC’s Director of Economics and Statistics. “With production down in every region, the data reflect muted end-use market performance and economic uncertainty.”

“The chemical industry is a key economic bellwether, as American manufacturing depends on chemical inputs to support production across sectors - from electronics and energy to housing and autos,” Lan explained.

“Outside of the U.S., global chemical production showed limited momentum as increased production in the Asia-Pacific region, South America and Africa and Middle east countries offset declines in Europe and North America,” Lan added.

Key findings:

  • ↓ U.S. Output Drops: Chemical production declined across all U.S. regions and nearly all segments. The only segment showing marginal growth was specialty chemicals, which inched up 0.1%. Compared to the same time last year, output was down 1.5%. ACC’s Chemical Manufacturer’s Economic Sentiment Indicator (ESI) continued to show that chemical production declined, but at a slower pace than during Q3. According to the latest ESI findings, companies were more optimistic about production levels six months ahead, suggesting the potential for a future rebound. 
  • ↑ China Rebounds: Following a 0.2% decline in November, China’s chemical output rose 0.6% in December. Growth continued to be driven by robust export demand as internal consumption and investment remains weak due, in part to the soft property market. Output ended the year with an 8.1% increase compared to the same month last year.
  • ↓ Europe Weak: European chemical production fell 0.8% in December, extending a 0.6% drop in November. High energy costs, ongoing trade uncertainty, and import competition continue to force restructuring across the sector. The Netherlands was the only country to show growth during December, and a weak regional Purchasing Managers’ Index (PMI) signals ongoing fragility. On a year-over-year basis, production was down 2.0%. 
  • ↑ South America Stabilizes: South American production rose 0.4% in December, continuing its recovery from the October decline. Output in Argentina and Brazil appears to have stabilized. However, persistent inflation and trade tensions continue to constrain the region’s momentum. Production ended the year with a 2.3% decline compared to the same period last year. 

Additional Data