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U.S. Chemical Production Expands in July

Jennifer Scott

WASHINGTON (August 24, 2021) – The U.S. Chemical Production Regional Index (U.S. CPRI) rose 1.1% in July following a 3.5% gain in June and a 5.5% rebound in May, according to the American Chemistry Council (ACC). During July, chemical output rose in all regions, reflecting continued demand for chemistry products. The U.S. CPRI is measured as a three-month moving average (3MMA).

Chemical production was mixed in July (3MMA), with growth in the production of organic chemicals, fertilizers, adhesives, coatings, chlor-alkali, crop protection chemicals, synthetic rubber, other specialty chemicals, and miscellaneous inorganic chemicals. These gains were offset by weakness in manufactured fibers and consumer products.

USCPRI Chart 1 August 2021

As nearly all manufactured goods are produced using chemistry in some form, manufacturing activity is an important indicator for chemical demand. Following a 0.2% gain in June, manufacturing output continued to expand in July, by 0.7% (3MMA). The trend in manufacturing production was mixed, with gains in the output of motor vehicles and parts, aerospace, machinery, computers, semiconductors, iron and steel products, foundries, refining, oil and gas extraction, plastic products, rubber products, tires, printing, apparel and furniture.

Compared with July 2020, U.S. chemical production rose sharply in July, by 7.2%. Chemical production was higher than a year ago in all regions.

USCPRI Chart 2 August 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 June 28, 2021.

To smooth month-to-month fluctuations, the U.S. CPRI is measured using a three-month moving average. Thus, the reading in July reflects production activity during May, June, and July.

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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