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  • Weekly Economic Report

Weekly Chemistry and Economic Trends (May 12, 2023)

4.9% Consumer Prices (Y/Y)
0.5% Chemical Producer Price Index
$15.2B Chemical Exports

Running tab of macro indicators: 8 out of 20 

05-12-23-Macro Summary

The number of new jobless claims rose by 22,000 to 264,000 during the week ending May 6. Continuing claims increased/fell by 12,000 to 1.81 million, and the insured unemployment rate for the week ending April 29 was up/down/unchanged at 1.2%. 

05-12-23-Inflation and Interest Rates

Consumer prices increased (by 0.4%) in April and were up 4.9% from a year ago. Excluding the volatile food and energy components, core consumer prices were up 5.5% Y/Y. Both annual measures were their lowest since the latter part of 2021. Housing costs were the largest contributor to the monthly increase in the index for all items less food and energy. 

Headline producer prices increased slightly (by 0.2%) in April, driven by a rise in the index for final demand services. Core prices (prices less food, energy and trade services) also increased 0.2% in April, the largest increase since last November. Headline producer prices were up 2.3% Y/Y, the slowest pace in more than two years. For the 12 months ending in April, prices for processed goods for intermediate demand decreased 3.2%, the largest 12-month decline since falling 3.7% in July 2020. Following three months of declines, headline import prices were higher in April, up 0.4%, with higher prices for fuel imports offsetting flat growth in nonfuel exports. Export prices were also higher by 0.2%, with gains in prices for both agricultural and non-agricultural exports. Import prices were off 4.8% Y/Y while export prices were off 5.9% Y/Y.

05-12-23-Wholesale Inventory to Sales Ratios

Wholesale sales declined 2.1% in March, following a 0.4% increase in February. Out of all categories, only furniture and drugs showed growth. Wholesale inventories increased by 0.1%, following a 0.6% decrease in February. Sales were down 2.9% Y/Y, while inventories were up 9.1% Y/Y. The inventories-to-sales ratio ticked up slightly to 1.40 compared to February and up from 1.25 in March 2022. Among the categories with the most significant monthly increase in the inventories-to-sales ratio were automotive, machinery, farm products, and alcohol.

05-12-23-Energy Summary

Oil prices, which had risen earlier in the week, dropped on Thursday as a political standoff over the U.S. debt ceiling continues. U.S. natural gas prices fluctuated throughout the week, as concern of an economic slowdown continues, but closed slightly higher than a week ago. Natural gas inventories continued to build as demand for natural gas declines, heading into the summer months. The combined oil and gas rig count fell by 7 to 745. 

Indicators for the business of chemistry bring to mind a yellow banner. 

05-12-23-Chemicals Summary

According to data released by the Association of American Railroads, chemical railcar loadings were down 2.3% to 33,084 for the week ending May 6. Loadings were down 4.7% Y/Y (13-week MA), down 5.8% YTD/YTD and have been on the rise for 8 of the last 13 weeks. 

05-12-23-Chemicals Inventory to Sales Ratios

At the wholesale level, chemical sales were down 0.4% in March, following a 1.3% increase in February. Chemical wholesale inventories edged lower by 0.5% following a 1.2% decline in February. Compared to last March, sales were down 5.7% Y/Y while inventories were 1.4% Y/Y higher. The inventories-to-sales ratio for chemicals did not change (1.19) from February. Last March, the ratio was 1.10.

05-12-23-Chemicals Trade Surplus

U.S. chemical exports were up by 16.3% in March to $15.2 billion, a level down 4.7% Y/Y. Exports grew across all categories of chemicals. U.S. chemical imports also grew in March – by 5.8% to $12.1 billion, a level down 13.9% Y/Y. Imports were lower in most categories but expanded in consumer products, inorganics and coatings. The chemical trade surplus expanded by $1.5 billion to $3.1 billion in March and was up to $5.7 billion year-to-date. 

Chemical producer prices rose 0.5% in April as higher prices for plastic resins and synthetic rubber offset declines in inorganics and agricultural chemicals. Other chemical sectors showed slight increases (0.5% or less). Chemical producer prices were up 1.7% Y/Y (3MMA). Chemical import prices, however, moved lower by 0.2% in April, the third consecutive decline. Export prices edged slightly higher, up by 0.1%. Chemical import prices were up 9.8% Y/Y while export prices were off by 8.0% Y/Y.

Note On the Color Codes

The banner colors represent observations about the current conditions in the overall economy and the business chemistry. For the overall economy we keep a running tab of 20 indicators. The banner color for the macroeconomic section is determined as follows:

Green – 13 or more positives
Yellow – between 8 and 12 positives
Red – 7 or fewer positives

For the chemical industry there are fewer indicators available. As a result, we rely upon judgment whether production in the industry (defined as chemicals excluding pharmaceuticals) has increased or decreased three consecutive months.

For More Information

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Every effort has been made in the preparation of this weekly report to provide the best available information and analysis. However, neither the American Chemistry Council, nor any of its employees, agents or other assigns makes any warranty, expressed or implied, or assumes any liability or responsibility for any use, or the results of such use, of any information or data disclosed in this material.

Contact us at ACC_EconomicsDepartment@americanchemistry.com.

American Chemistry Council

The American Chemistry Council’s mission is to advocate for the people, policy, and products of chemistry that make the United States the global leader in innovation and manufacturing. To achieve this, we: Champion science-based policy solutions across all levels of government; Drive continuous performance improvement to protect employees and communities through Responsible Care®; Foster the development of sustainability practices throughout ACC member companies; and Communicate authentically with communities about challenges and solutions for a safer, healthier and more sustainable way of life. Our vision is a world made better by chemistry, where people live happier, healthier, and more prosperous lives, safely and sustainably—for generations to come.

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