MACROECONOMY & END-USE MARKETS
Running tab of macro indicators: 11 out of 20
The number of new jobless claims rose by 22,000 to 231,000 during the week ending May 4. Continuing claims increased by 17,000 to 1.785 million, and the insured unemployment rate for the week ending April 27 was unchanged at 1.2%.
Growth in non-mortgage consumer debt decelerated in March with balances up by $6.3 billion (an annualized 1.5% rate). Credit card balances were essentially unchanged while nonrevolving debt (e.g., car loans, student loans, etc.) rose at a 2.0% annual pace.
Wholesale inventories fell by 0.4% in March, with the largest percentage declines in farm products, alcohol, metals, groceries, paper, apparel, and hardware. The largest inventory builds (on a percentage basis) were in computer equipment, furniture, and petroleum products. Sales at the wholesale level fell 1.3%, following a 2.0% gain in February. Sales declined across a large number of durable and nondurable categories. Compared to a year ago, sales were higher by 1.4% while inventories were off 2.3% Y/Y. The inventories-to-sales ratio edged higher from 1.34 in February to 1.35 in March. A year ago, the ratio was 1.40.
Global semiconductor sales fell 0.6% in March with declines in all regions except China which was flat. Compared to a year ago, global sales were up 15.2% Y/Y.
ENERGY
Oil prices moved slightly higher this week after Israel announced it would continue its military operations in Gaza. U.S. natural gas prices also moved higher as production was curtailed due to pipeline maintenance that trapped supply. At the same time, flows to LNG terminals have increased as Freeport LNG restarted a train. Natural gas inventories remain more than 33% above the five-year historical average, however. The combined oil and gas rig count fell by 10 to 601 during the week ending 5/3.
CHEMICALS
Indicators for the business of chemistry bring to mind a yellow banner.
According to data released by the Association of American Railroads, chemical railcar loadings were down to 32,393 for the week ending May 4. Loadings were up 0.6% Y/Y (13-week MA), up (3.9%) YTD/YTD and have been on the rise for 7 of the last 13 weeks.
U.S. chemicals exports rose 7.0% in March but were down 6.1% Y/Y and down 3.5% YTD/YTD. Chemical exports rose in every category except agricultural chemicals (which were down by 4.6% in March). Exports of plastic resins rose by 1.4% on a volume basis and rose by 9.3% on a USD$ basis in March. Chemical imports rose 6.8% in March but were down 7.4% Y/Y and down 8.5% YTD/YTD. Imports increased in every category except bulk petrochemicals and intermediates which fell 2.4% in March. As exports grew faster than imports, the overall chemicals trade surplus expanded in March to $3.1 billion.
Sales of chemicals at the wholesale level rose by 2.6% to $13.35 billion in March. Wholesale chemical inventories also rose, by 0.5%. Compared to a year ago, sales were up by 1.3% while inventories were off by 9.9% Y/Y. The inventories-to-sales ratio dipped to 1.10 in March from 1.12 in February. This was the lowest since September 2021. A year ago, the ratio was 1.23.
Note On the Color Codes
Banner colors reflect an assessment of the current conditions in the overall economy and the business chemistry of 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
There are fewer indicators available for the chemical industry. Our assessment on banner color largely relies upon how chemical industry production has changed over the most recent three months.
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