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U.S. Chemical Production Eased in August

Jennifer Scott

WASHINGTON (September 27, 2021) – Reflecting hurricane disruptions and supply chain challenges, the U.S. Chemical Production Regional Index (U.S. CPRI) fell 0.3% in August following a 1.1% gain in July and a 3.4% gain in June, according to the American Chemistry Council (ACC). During August, chemical output fell sharply in the Gulf Coast region and eased in other regions except the Northeast. The U.S. CPRI is measured as a three-month moving average (3MMA).

Chemical production was mixed in August, with an improving trend in the production of synthetic rubber, manufactured fibers, other specialty chemicals, fertilizers, coatings and consumer products. These gains were offset by weakness in organic chemicals, plastic resins, miscellaneous inorganic chemicals, crop protection chemicals, and adhesives.

US Chemical Production Regional Index Chart 1 September 2021

As nearly all manufactured goods are produced using chemistry in some form, manufacturing activity is an important indicator for chemical demand. Following a 0.8% gain in July, manufacturing output expanded by 0.5% in August (3MMA). The trend in manufacturing production was mixed, with gains in the output of motor vehicles and parts, aerospace, construction supplies, machinery, computers, semiconductors, iron and steel products, foundries, plastic products, printing, textile mill products, apparel and furniture.

Compared with August 2020, U.S. chemical production rose 5.9% in August. Chemical production was higher than a year ago in all regions.

US Chemical Production Regional Index Chart 2 September 2021

The chemistry industry is one of the largest industries in the United States, a $486 billion enterprise. The manufacturing sector is the largest consumer of chemical products, and 96% 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. The U.S. CPRI includes the most recent Federal Reserve benchmark revision released on May 28, 2021. To smooth month-to-month fluctuations, the U.S. CPRI is measured using a three-month moving average. The reading in August reflects production activity during June, July, and August.

American Chemistry Council

The American Chemistry Council (ACC) represents the leading companies engaged in the business of chemistry. ACC members apply the science of chemistry to make innovative products and services that make people's lives better, healthier and safer. ACC is committed to improved environmental, health and safety performance through Responsible Care®; common sense advocacy designed to address major public policy issues; and health and environmental research and product testing. The business of chemistry is a $486 billion enterprise and a key element of the nation's economy. It is among the largest exporters in the nation, accounting for ten percent of all U.S. goods exports. Chemistry companies are among the largest investors in research and development. Safety and security have always been primary concerns of ACC members, and they have intensified their efforts, working closely with government agencies to improve security and to defend against any threat to the nation’s critical infrastructure.

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