Issue Date: July 1, 2013
Lackluster Year For Chemical Output
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Statistics about the global chemical industry’s output in 2012 came in all shapes and sizes but generally shared a resemblance to the anemic overall economic picture. In the U.S., the industry grew by a scant 0.1%. Germany, Europe’s largest producer, saw declines in most organic chemicals but healthy growth in most inorganics. And Japan’s output of most chemicals was down sharply.
U.S. chemical manufacturing did hold some bright spots, according to indexes from the Federal Reserve Board. For example, output of basic chemicals grew 4.7%, organic chemicals rose by 2.2%, and pharmaceuticals and medicines progressed at a 5.2% rate. The industry was helped along domestically by small but steady increases in consumer spending on durable goods. In addition, exports were $207.3 billion, essentially even with the record year of 2011.
Industry data show that U.S. fiber production shrank by 5.2% for nylon but grew by 5.7% for olefin and 9.9% for polyester. Nitrogen fertilizers in the U.S. were also on a growth trajectory; the sector may already be seeing the impact of the increasing availability of natural gas from shale. Ammonia output increased by 3.6% compared with a historic decline of 2.1% per year over the past decade. In contrast, most plastics saw little to no growth.
In Germany, output figures varied. The largest organic chemical markets saw volumes decline in 2012—in many cases by significantly more than the decade average. Output dipped by 3.7% for ethylene, 2.5% for propylene, and 1.7% for benzene. In contrast, output of the inorganic chemicals hydrochloric acid and hydrogen peroxide each jumped by more than 10%.
Figures for Japan show an industry in contraction. Most sectors saw moderate declines in line with historical averages. But plastics sank much more sharply than usual, with polyethylene output eroding 8.1%. In South Korea, the chemical industry is growing steadily, and that was true in 2012 as well. The country saw significant increases in output of all organics and plastics.
China’s growth rate for basic chemicals was blistering in 2011 but slowed in 2012. Output of benzene and ethylene shrank slightly, while methanol production grew 18.6%, which is slower than the 2011 growth rate of 41.5%. Inorganics in China grew slowly but still had a solid year. Sodium hydroxide output increased the most, by 9.4% for the year.
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