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U.S. Chemical Production Forecast to Grow by 3.6% in 2019

June 14, 2018
The ACC estimates that chemical production will grow the most in the Gulf Coast, Midwest, and Ohio Valley regions. Image courtesy of Flickr user royluck
The ACC estimates that chemical production will grow the most in the Gulf Coast, Midwest, and Ohio Valley regions. Image courtesy of Flickr user royluck

Gains in America’s manufacturing, construction, and export markets are projected lift the growth rate of U.S. chemical production to 3.6% in 2019 from an estimated rate of 3.4% this year, according to a new report by the American Chemistry Council (ACC).

Released this month, the ACC’s “Mid-Year 2018 Chemical Industry Situation and Outlook” posits that production of fertilizers, crop protection products, coatings, consumer products, and petrochemicals will increase during the next 18 months.

“During 2018, output gains are expected to be strongest in agricultural chemicals, consumer products, coatings, and bulk petrochemicals and organics,” the report said. “In addition, production of plastic resins is set to grow at the fastest pace since 2012 as new capacity comes on line and demand firms for domestic customers and those abroad. The specialty chemicals segment is also set to grow as industrial activity improves.”

The ACC forecasts that chemical production is likely to grow the most in the Gulf Coast, Midwest, and Ohio Valley regions this year. High availability of domestic sale gas and natural gas liquids (NGLs) are projected to fuel capacity investments and capital spending through 2023.

While the organization’s report offered a positive outlook for the U.S. chemicals industry into 2019, the ACC cautioned that shifts in U.S. trade and economic policies may hinder growth.

“Introducing barriers to trade within the chemical sector and downstream sector will negatively impact the industry’s grade growth performance,” the ACC’s report stated. “Indeed, even the threat to such policies introduces uncertainty for future investments and the ability to fully employ the U.S. as an export platform.”

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