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C&EN’s World Chemical Outlook 2023

We analyze the business trends, government policies, and societal forces that will affect chemistry in the year ahead

January 11, 2023 | A version of this story appeared in Volume 101, Issue 2
C&EN's World Chemical Outlook 2023.

Credit: Shutterstock






US chemical industry will take a hit from a mild recession

by Alex Tullo
An upbeat automotive forecast will be good for the chemical industry in 2023.
Credit: John Gress Media Inc/
An upbeat automotive forecast will be good for the chemical industry in 2023.


Economists say the US is in for a recession in early 2023.

Lower demand is making for a weak US chemical outlook after a strong 2022.

US chemical producers enjoy raw material advantages over foreign competitors, but overseas demand might not support exports.


The US chemical industry is headed for a soft patch. Most economists expect a mild recession early this year, which would throw cold water on chemical demand and production. Advantageous raw material prices continue to make the US industry globally competitive, however, and exports should be brisk—provided that offshore demand holds up.

Already, higher prices born of inflation have hit the wallets of US consumers. In response, the Federal Reserve has been combating inflation by raising interest rates, which increases the cost of borrowing for major purchases like houses. Add weakening European and Chinese economies to the mix, and it spells a likely US recession.

“However, the recession is projected to be short and mild, amid a strong labor market and relatively healthy consumer and business balance sheets,” wrote the Conference Board, an economics think tank, in a November report.

The American Chemistry Council (ACC), an industry group, also expects a shallow recession. After a strong 2022, in which US chemical production rose 3.9%, the ACC forecasts that output will decline by 1.2% in 2023.

One reason, the group says, is that construction of new homes, a big market for the chemical industry, will slip in 2023 because of the high cost of borrowing.

But another big chemical market—automotive manufacturing—could be a bright spot, now that a computer chip shortage that had been weighing on the industry is clearing up. The ACC forecasts that US sales of light vehicles will increase from 13.8 million units in 2022 to 14.9 million this year. “There’s some decent pent-up demand for vehicles in the system right now,” the council’s chief economist, Martha Gilchrist Moore, told reporters in December.

US chemical output is expected to slip this year after a strong 2022.
Bar graph with the ACC's forecast for the US chemical industry.
Source: American Chemistry Council. Note: "Chemical production" excludes pharmaceuticals. a Predicted.

As always, the US chemical industry’s fortunes will depend to a large degree on the global competitiveness of its ethylene and other basic petrochemicals. Ashish Chitalia, head of petrochemicals, polymers, and sustainability management at the consulting firm Wood Mackenzie, says business was good in the first half of 2022. Demand was strong, and a tangled supply chain kept imports out of the market.But toward midyear, he says, demand slowed and the supply chain straightened out. Inventories spiked and petrochemical makers had to reduce operating rates.

The industry will work down this inventory during the year, according to Chitalia. “We are expecting in the second quarter of 2023 we’ll see a balanced situation in North America,” he says.

Relatively low energy prices should be a positive for the US chemical industry in 2023. Russia’s invasion of Ukraine shocked energy markets in 2022. Oil prices soared, rising by about 50% through June before falling.

The war’s impact on natural gas prices was even stronger. It was greatest in Europe, which depends on Russia for much of its supply, but the US wasn’t spared. US natural gas prices hit their highest levels in more than a decade as producers redirected liquefied natural gas exports to Europe.

Right now, it costs twice as much to produce ethylene in Asia as it does in the US.
Ashish Chitalia, head of petrochemicals, polymers, and sustainability management, Wood Mackenzie

But US prices never got so high that natural gas was more expensive than oil on an energy-content basis. This is good news for US chemical producers, which typically extract petrochemical raw materials from natural gas instead of petroleum, as most of the world does.

“Right now, it costs twice as much to produce ethylene in Asia as it does in the US,” Chitalia says.

Michael McMurray, chief financial officer of the petrochemical maker LyondellBasell Industries, told the Citi Basic Materials conference in November that he is watching whether the Chinese market will be robust enough to draw US exports. China imports 40% of the polyethylene it consumes, but the country’s zero-COVID policies have slowed its giant economy.

“We really need China to kind of reopen, I think, for the overall demand environment to improve and hopefully for margins to start improving as well,” McMurray said.



Talks to continue on a plastics pact and chemical agreements

by Cheryl Hogue
A beach is littered with washed up bottles, toys, a child's plastic shoe, and a tire.
Credit: Shutterstock
Discussions about how to control plastic pollution will dominate the international environmental policy agenda this year.


Negotiations on a plastics treaty will be in full swing.

Governments will consider whether to control groups of related chemicals, rather than just single compounds, under a treaty on persistent organic pollutants.

Countries will try to revive an expired agreement to improve the global management of commercial chemicals.


Controlling plastic pollution and persistent pollutants and improving the management of commercial substances will top the international policy agenda for chemicals this year.

The first talks on a global agreement to curb plastic pollution ended in December, and negotiators have scheduled second and third rounds of negotiations for later this year. The fourth round and a final, fifth round are set for 2024.

Major issues are whether a future agreement will include restrictions on production of single-use plastics and on toxic chemicals intentionally added to plastics to impart useful characteristics.

Negotiators also haven’t determined whether to embrace chemical recycling techniques being pushed by the plastics industry and the US government. The main commercial form of this technology, pyrolysis, is not available in much of the world, and questions remain about its economic viability.

Also up in the air is the role scientists will play in advising negotiators and partners to the completed agreement.

Bethanie Carney Almroth, a professor of environmental science at the University of Gothenburg, is part of an informal network of about 150 scientists from around the world who are looking to help. They want to provide guidance so that negotiators can craft a science-based agreement and prevent regrettable substitutes for current plastic items, she says.

Some governments are skeptical about this idea. They prefer to rely on international agencies, including the UN Environment Programme, World Health Organization, and Food and Agriculture Organization to provide scientific advice for the talks.

Other countries are suggesting that the plastics agreement establish an official science advisory group to counsel governments on future actions—similar to a panel formed under the Stockholm Convention on Persistent Organic Pollutants. That body reviews scientific data and makes recommendations to treaty partners on which chemicals should be banned or severely restricted.

The chemical industry supports the idea of a scientific advisory group for the plastics pact, says Stewart Harris, speaking on behalf of the International Council of Chemical Associations, an umbrella group of industry organizations. He says the sector wants to ensure that industry scientists, who have deep expertise on plastics, are part of the advisory group.

Meanwhile, governments will gather in Geneva in early May to determine if they will add more chemicals to the Stockholm Convention. They are scheduled to decide whether to ban the once widely used chemicals perfluorooctane sulfonic acid (PFOS) and its salts and perfluorooctane sulfonyl fluoride, which was used to make PFOS. PFOS is highly persistent and is toxic even at very low concentrations.

They will also decide whether to adopt recommendations from the convention’s Persistent Organic Pollutants Review Committee to ban the insecticide methoxychlor. And governments are considering controls on the ultraviolet stabilizer UV-328, which is used in many types of plastic.

At the May meeting, governments will consider controlling classes of chemicals rather than individual substances under the Stockholm Convention, according to Bjorn Beeler, international coordinator at the nonprofit International Pollutants Elimination Network. Classes could include UV stabilizers, certain flame retardants, per- and polyfluoroalkyl substances (PFAS), and chlorinated paraffins. Each of these groups has members with similar toxicity and persistence.

Chemical makers have concerns about a class-based approach to chemicals under this treaty, says American Chemistry Council spokesperson Andrew Fasoli. At times, he says, it is appropriate to list more than one chemical—such as PFOS and its salts. But to legally list broad classes of molecules in the treaty, governments will need to negotiate an amendment, Fasoli adds.

This year, governments will also attempt to revive an agreement to improve the management of chemicals globally. The Strategic Approach to International Chemicals Management (SAICM), established in 2006, is a set of policy guidelines that expired in 2020. Negotiations to extend SAICM through 2030 were interrupted by the COVID-19 pandemic.

Negotiators will restart work on SAICM at the Fifth International Conference for Chemicals Management in Bonn, Germany, Sept. 25–29. The chemical industry has backed SAICM since its inception as a way to ensure that all actors in the supply chain are trained and accountable for the safe handling of commercial chemicals.



Environmental justice advocates will monitor the path of federal funding

by Rick Mullin
A panel of four people at COP27 discussing the future of enviornmental justice. The photo includes Michael S. Regan, Beverly L. Wright, Robert Bullard, and Peggy Shepard sitting in chairs on a stage.
Credit: Chris Jordan-Bloch/Earthjustice
US Environmental Protection Agency administrator Michael S. Regan participated on a panel with (left to right) Beverly L. Wright, executive director of the Deep South Center for Environmental Justice; Robert Bullard, director of the Bullard Center for Environmental and Climate Justice; and Peggy Shepard, executive director of We Act for Environmental Justice at COP27 last year.


Commitment of federal dollars for environmental justice has reached a record level under the Biden administration.

Community leaders are mobilizing to ensure federal money reaches communities of need.

Environmental justice leaders have taken an advisory role at the federal level.


“I think 2023 will be a very busy year,” says Robert Bullard, director of the Bullard Center for Environmental and Climate Justice. “Busy from the standpoint of building on some of the wins that we were able to achieve in 2022, particularly as it relates to getting environmental and climate justice integrated into federal policy, and making sure resources and funding follow those priorities.”

Bullard, Distinguished Professor of Urban Planning and Environmental Policy at Texas Southern University, notes that federal funds and programs from President Joe Biden’s administration amount to a level of support that the environmental justice movement has never seen before. The $369 billion Climate Bill, part of the Inflation Reduction Act of 2022, for example, commits $60 billion to establishing grants and funding clean energy and environmental mitigation projects in disadvantaged communities.

More broadly, the Biden administration has committed to channeling 40% of the benefits of relevant federal investment to communities that bear a disproportionate environmental burden—a program called Justice40.

The problem now, Bullard says, is ensuring that the money—especially the federal funding that is distributed through state and local governments—gets to the right places. The prospect of inexperienced community organizations forming to compete for funding with groups that have been working on the front line for years concerns him.

“We are saying that we will not sit idle while we see money siphon off into places and into programs and going to projects that bypass our communities,” Bullard says. “That is the 2023 challenge.”

Peggy Shepard, executive director of We Act for Environmental Justice, says the onus of seeing that promises to communities are kept is on the communities themselves.

“The whole foundation of working to achieve environmental justice is local,” Shepard says. But essential resources are lacking at the local level. “We have some communities with maybe one staff person. You can’t really do a lot if you don’t have staff. If you don’t have a policy person, how are you engaging with the federal government? How do you engage on the state level on climate change?”

Shepard adds that local and state elected officials, and even some members of Congress, are unfamiliar with the Justice40 initiative. Last month, We Act kicked off an 11-city tour intended to bring community leaders and elected officials together to raise awareness of the 40% directive.

Awareness of the broader environmental justice movement has risen, however, beginning with the focus on racial inequality in the US that followed the murder of George Floyd in 2020 and then-candidate Biden’s avowed commitment to environmental justice. Shortly after his inauguration in 2021, the administration announced establishment of the White House Environmental Justice Advisory Council.

Shepard, cochair of the council, says environmental justice has been given a much more prominent seat at the federal table. “We might have known one or two people at a federal agency, generally the EPA,” she says, referring to the Environmental Protection Agency. “But the council has provided more access and input to other agencies—the Department of Transportation, Department of Energy, Department of the Interior.”

And these agencies require guidance on where resources are needed at the local level, Shepard says. “The issue with the federal government is they are trying to implement something transformational and formative, but they have not created the structure to do that.”

Community advocates also plan to be heard on the international climate policy stage in 2023. We Act, the Bullard Center, and the Deep South Center for Environmental Justice hosted a climate justice pavilion at last year’s UN Climate Change Conference, or COP27, in Sharm el-Sheik, Egypt. The pavilion, which in recent years has been located in the general area known as the Green Zone, was for the first time in the Blue Zone, where policy makers and delegations have pavilions.

The groups held several panels, one of which included EPA administrator Michael S. Regan. “We explained the challenge that all our states are not created equal,” Bullard says. “There are some that will do a great job in distributing money in a way that will follow need, and others in a way that will be problematic. And [Regan] said in public that if a state is not spending money in a way that is designed, EPA will withhold the money.”



Europe faces painful new normal of higher natural gas prices

by Alex Scott
Evonik Industries' site in Marl, Germany.
Credit: Evonik Industries
Evonik Industries says its new power plant in Marl, Germany, can run on liquefied petroleum gas, making the firm less dependent on natural gas.


Natural gas price inflation will be a major burden in 2023.

The German chemical sector expects “persistently difficult” conditions.

Leading European chemical firms plan to cut costs in Europe and expand in North America and Asia.


The industrial woes Europe faced in 2022—high energy prices and depressed economic conditions resulting from Russia’s decision to turn off its supply of natural gas to the region—are set to continue in 2023, according to economists and industry leaders.

The European Union’s economic outlook for 2023 “has weakened significantly,” Paolo Gentiloni, the European Commissioner for economy, said at a press conference in November. The commission forecasts that the region’s economy will grow just 0.3% in 2023 and 1.6% in 2024.

Or as Peter Huntsman, CEO of the US chemical maker Huntsman, put it in a recent call with stock analysts: “Europe continues to be a basket case. There just seems to be a great deal of uncertainty.”

Europe continues to be a basket case.
Peter Huntsman, CEO, Huntsman

A silver lining is that natural gas prices have fallen from their record highs in the summer of 2022—when they forced some chemical companies to idle or close plants—and are now below what they were right before the war. This is partly because a mild winter in Europe has reduced demand. Additionally, US liquefied natural gas is playing a critical role in meeting European energy demand, Kristy Kramer of the consulting firm Wood Mackenzie writes in an outlook report.

Analysts at the investment firm Jefferies forecast that any sustained improvement in financial performance among leading European chemical firms is “unlikely” in 2023 and that recovery will be volatile.

VCI, Germany’s main chemical industry association, described conditions as “persistently difficult” in a press release published at year-end. VCI president Markus Steilemann expects that “more dark months are ahead” for the industry.

Sounding a more optimistic note, the American Chemistry Council, a US trade group, predicts that chemical production in Western Europe will grow by 0.8% in 2023 after declining 3.2% in 2022. The European Chemical Industry Council, Europe’s main industry group, hasn’t yet published a forecast for 2023.

Even if modest growth is on the horizon, European chemical companies like BASF and Evonik Industries are responding to market conditions by substantially reducing operating costs and investment in the region. BASF aims to cut costs by nearly $500 million annually for the next 2 years, mostly in Europe. Evonik cites the planned sale of its performance materials business as a key positive for 2023, as it will reduce the firm’s exposure to Europe.

Evonik forecasts that its energy and natural gas costs will increase by $310 million in 2023, to $1.7 billion, following a $620 million price hike in 2022. The firm expects to shave some energy costs by adding the ability to switch fuel for the power plant at its site in Marl, Germany, from natural gas to liquefied petroleum gas.

Huntsman, which has a substantial manufacturing presence in the UK and elsewhere in Europe, recently upped its planned cost cuts in Europe by 20%, to $280 million per year, by the end of 2023.

“It’s more than just saying we’ve got to suck in our gut and stop buying newspaper subscriptions for the next year,” Peter Huntsman said on a call with analysts. “We’ve got to fundamentally restructure in Europe, because Europe itself is being fundamentally restructured. And you are seeing a massive deindustrialization.”

Peter Huntsman expects high natural gas prices to become “permanently embedded” in the region. “Europeans are doing a horrible job when it comes to long-term energy security and competitiveness,” he added.



China’s chemical industry is poised for a rebound

by Hepeng Jia, special to C&EN
COVID-19 restrictions held back China's economy and its chemical industry.
Credit: Shutterstock
COVID-19 restrictions held back China's economy and its chemical industry.


China’s chemical industry is expected to rebound after the lifting of COVID-19 restrictions.

Sectors such as pharmaceuticals and agricultural chemicals are poised for growth.


After a bumpy 2022, China’s chemical industry is poised to benefit this year from the country’s recent lifting of its zero-COVID-19 policies.

In the first 10 months of 2022, profits for China’s chemical manufacturing sector declined by 3.6% from the same period in 2021, to about $93 billion, according to China’s National Bureau of Statistics. Owing mostly to rising oil prices, industry sales rose by 13.6%, to $1.1 trillion.

That dim profit picture is a change from 2021 and even the first quarter of 2022, when intense global demand for Chinese electronics and consumer products drove a boom in chemical sales. But the lockdowns that started in the second quarter of 2022—especially the 2-month shutdown of Shanghai, the country’s main economic hub—severely injured China’s economy, including its chemical sector.

The loosening of quarantine requirements has created a very different environment for 2023. The Chinese government removed nearly all restrictive measures Dec. 7, and state media changed their tone to play down the risk of severe illness from COVID-19.

The year 2023 will be a starting year for a new industrial boom.
Ye Yingmin, president, Chem1

Notably, the expected explosion in COVID-19 infections is spurring the pharmaceutical sector, including demand for analgesics such as acetaminophen. Meanwhile, the agricultural chemical sector is looking forward to a prosperous year as pesticide and fertilizer prices climb.

Ye Yingmin, president of the Beijing-based consulting firm Chem1, is optimistic about the year ahead. “The year 2023 will be a starting year for a new industrial boom,” Ye says. Yet, with reports of COVID-19 infections and deaths flooding social media platforms in China, the challenge for economic and industrial recovery remains tremendous.

On Jan. 3, the China Federation of Logistics and Purchasing and the National Bureau of Statistics announced that the Purchasing Managers Index for the manufacturing sector declined from November to December, indicating shrinking economic activity despite the changed COVID-19 policy.



Industry will coalesce around standards for how to count carbon

by Craig Bettenhausen
A USDA BioPreferred label indicates 87% biobased carbon.
Credit: USDA
The USDA BioPreferred ecolabel may be updated in 2023 to include greenhouse gas emission information.


Governments and consumer product makers want comparable sustainability scores.

USDA BioPreferred is likely to incorporate carbon footprints.


As pledges to reduce greenhouse gas emissions become part of the social license to operate for companies in almost every sector, methods of counting carbon dioxide have proliferated. In 2023, the chemical industry will respond to customers demanding scores that they can compare by starting to coalesce around a select few approaches to sustainability accounting.

Charlie Quann, climate change lead at the sustainability consulting firm Antea Group, says some strong standards have already emerged. He says the Global Reporting Initiative is the main game in town for reporting sustainability to shareholders and financial regulators. In addition, he says, the Science Based Targets Initiative leads for setting and tracking greenhouse gas targets, and the Climate Disclosure Project’s environmental reporting framework—already popular—will grow in impact because of a new Biden administration rule requiring federal contractors to participate.

For individual products, the US Department of Agriculture’s BioPreferred ecolabel is already influential, and an effort underway to improve it could bear fruit in 2023. Right now, products earn the USDA Certified Biobased Product ecolabel by meeting a threshold for biobased content—generally 25% or higher. Products also state the percentage of biobased content, based on carbon isotope ratios.

The label is effective at boosting biobased materials and influencing consumer behavior but doesn’t directly measure sustainability, according to Rina Singh, executive vice president for policy at the nonprofit Alternative Fuels and Chemicals Coalition. Singh is working with the testing organization ASTM International to publish a full-life-cycle carbon footprint method and with the USDA to incorporate the result in an updated USDA ecolabel. The new BioPreferred label would include a color code indicating that a product is a net carbon sink, carbon neutral, or a net carbon emitter.

The method Singh is working on is now in early balloting at ASTM, and she predicts that it will pass midyear. She says her group’s early conversations with the USDA and key lawmakers are going well, and she expects the change to be part of the 2023 farm bill.

Stefan Unnasch, managing director of the life-​cycle-analysis firm Life Cycle Associates, says governments are in the best position to anoint standard methods and metrics. He cites the US Department of Energy’s GREET model as another robust platform for counting CO2. But making standards align across international borders has not been a priority, causing headaches for global businesses.



Another challenging year ahead for US chemical regulators

by Britt E. Erickson
A piece of chrysotile asbestos.
Credit: Shutterstock
This could be the year that the US Environmental Protection Agency finalizes a ban on chrysotile asbestos.


The US Environmental Protection Agency is likely to finalize a ban on chrysotile asbestos imports this year, despite opposition from the chlor-alkali industry.

The agency is not on track to meet deadlines related to evaluating the risks of a few dozen high-priority chemicals under the Toxic Substances Control Act.

The EPA is unlikely to meet the 90-day deadline to review the risks of new chemicals before they enter the market.


Ensuring the safety of chemicals is one of the most serious management challenges facing the US Environmental Protection Agency, according to a recent report from the EPA’s Office of Inspector General. The agency is not on track to meet statutory deadlines in 2023 related to chemical safety because of an increased workload and the need for resources, particularly scientists trained in chemical risk assessment, the report finds.

The EPA has not been able to meet deadlines under the Toxic Substances Control Act (TSCA) ever since Congress revamped the law in 2016. And the agency is slipping further behind each year.

In 2020, under former president Donald J. Trump’s administration, the EPA completed the first 10 risk evaluations for high-priority chemicals on the market. Several of those assessments were 6 months late.

In June 2021, under the new leadership of Michal Freedhoff, the EPA’s chemical office changed how it conducts risk assessments to ensure they are science based and legally defensible. The agency spent the last year and a half revising the first 10 assessments to reflect those policy changes.

To date, the EPA has proposed a rule to manage the risks for only 1 of the 10 chemicals—asbestos. That rule, proposed in April 2022, would ban US imports of chrysotile asbestos. The carcinogenic substance is used exclusively by the chlor-alkali industry. Chlorine makers claim the ban would have a negative impact on water disinfection and chemical supply chains. The agency is likely to finalize the rule in 2023 amid industry opposition, and chemical makers are likely to challenge it in court.

The EPA has nearly finished revising the assessments for the other 9 chemicals, except for the solvent 1,4-dioxane. The agency is completely redoing that one.

$64 million and 201 full-time employees

The additional resources the Environmental Protection Agency says it needs to implement the Toxic Substances Control Act.

Source: US EPA

“We’re working as quickly as we can to put measures in place to protect people from exposures to dangerous chemicals like trichloroethylene, methylene chloride, and asbestos,” Freedhoff told the Senate Environment and Public Works Committee in June 2022. The deadlines for proposing rules for reducing risks of the 10 chemicals have passed, and the EPA didn’t meet any of them. “Without additional resources, we won’t get more than a handful of those rules on the books before 2025, or beyond,” Freedhoff testified.

In addition to the first 10 chemicals, the agency is evaluating the next set of about two dozen high-priority chemicals. Deadlines for those evaluations started in late 2022, and the EPA missed all of them. “It’s unclear whether we’ll even be able to complete half of them before 2025,” Freedhoff said at the June hearing.

The agency is also struggling to meet the 90-day deadline to review the risks of new chemicals before they hit the market. Freedhoff told lawmakers in June that fixing scientific integrity issues and hiring additional staff in the new chemicals program is the top priority for her office.

We’re working as quickly as we can to put measures in place to protect people from exposures to dangerous chemicals like trichloroethylene, methylene chloride, and asbestos.
Michal Freedhoff, assistant administrator, Office of Chemical Safety and Pollution Prevention, US Environmental Protection Agency

To get TSCA implementation back on track, the EPA asked Congress for an increase of nearly $64 million and of 201 full-time employees for fiscal 2023, which began Oct. 1. “There’ll be real consequences if we don’t get these resources,” Freedhoff told lawmakers in June. “Communities, workers, children—all of us, really—would go even longer without the health protections we need and deserve.”

Lawmakers passed the 2023 budget just before the new year, giving the EPA $9 million for TSCA implementation. The EPA must collect that amount from industry paid user fees to offset the costs.

The EPA proposed raising TSCA-related fees in November and will have to do so this year to comply with the 2023 appropriations bill. Those fees, paid by chemical manufacturers, help support the agency’s review of the safety of new chemicals and those already on the market that may pose a health risk. The EPA can collect up to 25% of the cost of reviewing chemicals from industry-paid user fees, but so far those fees have covered only about 12% of the costs.


Persistent Pollutants

EPA is poised to impose cleanup liability for 2 PFAS

by Cheryl Hogue
Chemical structure of perfluorooctanoic acid and perfluorooctanesulfonic acid.


The EPA intends to establish liability for cleaning up two formerly used PFAS that are widespread pollutants.

The agency wants more data from chemical manufacturers about PFAS production and by-products, worker exposure, and disposal methods.


Companies in the US are expected to face new liability this year for cleanup of two widespread per- and polyfluoroalkyl substances (PFAS). In addition, the US Environmental Protection Agency intends to require chemical manufacturers to provide regulators with more data about PFAS production.

PFAS are synthetic chemicals that are highly resistant to degradation, providing qualities such as waterproofing and grease proofing. Though there are thousands of these substances, few have been studied for their health or environmental effects. Some have been found to be highly toxic.

This year, the EPA intends to finalize its designation of two PFAS as hazardous substances under the federal Superfund program for cleaning up sites contaminated with toxic waste, according to an agency report issued in November. The action would affect companies and others that released perfluorooctanoic acid (PFOA) and perfluorooctanesulfonic acid (PFOS), including their salts and structural isomers.

PFOA and PFOS are contaminants widely found in water, soil, and sediments. Published evidence indicates that they are toxic to humans at very low levels. The two chemicals were formerly ingredients in foams used to extinguish liquid-fuel fires. They also had applications in a number of industrial processes, including the production of fluoropolymers.

The EPA’s planned designation would make companies liable for PFOA and PFOS releases. The agency could either require polluters to clean up these substances­ or could conduct cleanups and recover costs from those responsible for the contamination.

The American Chemistry Council, a chemical industry trade group, opposes the EPA’s liability plan, calling it expensive and unworkable.

In addition, the EPA plans to complete a rule this year that would require companies to report on the quantities of PFAS that are produced in or imported into the US or are by-products of manufacture, the agency report says. This regulation would also require companies to provide information about worker exposure to and disposal methods for these chemicals.


Energy Storage

Public money will make 2023 the year of the battery factory

by Matt Blois
Several electric cars stopped at charging stations on a street.
Credit: Shutterstock
Many battery materials companies were already considering expansion in the US, but recent legislation has accelerated those decisions.


The US government is funneling $142 billion into the electric vehicle industry.

Many projects catalyzed by that funding will be announced in 2023.


A tsunami of public funding is motivating companies to draw blueprints for scaling up every part of the US battery industry, especially for electric vehicles.

RMI, a nonprofit promoting clean energy technology, estimates that the Jobs and Infrastructure Act, the CHIPS Act, and the Inflation Reduction Act (IRA) will funnel a total of $142 billion into the US battery industry through tax credits for making battery components and through direct grants for factories.

The biggest impact will come from production tax credits in the IRA, says Nathan Iyer, an associate with RMI. Starting this year, battery cell manufacturers in the US will get tax credits that could cover 30% of their costs. Companies making components for battery cells, such as cathode and anode materials, additives, and electrolytes, will get tax credits for about 10% of their production costs. A tax credit for electric cars made with components and minerals from North America serves as a longer-term incentive.

While it will take years to build those factories, Iyer expects most of the plans to be set in the next 12 months. The tax credits expire after 10 years, so companies have to move quickly. “In 2023, the wheels start turning,” he says.

$142 billion

The estimated amount that the Inflation Reduction Act, the 2021 infrastructure bill, and the CHIPS Act will funnel into the US battery industry


The tax credit that manufacturers will receive through the Inflation Reduction Act for making battery components in the US

Source: RMI.

In February 2022, Graphex Technologies, which makes anode materials in China, announced plans for a graphite processing facility in Michigan that is expected to open in 2023. CEO John DeMaio says the passage of the IRA in August 2022 encouraged the company to expand further. The company is now planning a second US plant that would carry out a separate graphite processing step. “We were already on the path to domesticating the supply chain because it makes good business sense,” DeMaio says.

In 2023, the wheels start turning.
Nathan Iyer, senior associate, RMI

Venture capital funding for batteries is also accelerating, according to Eric Rosenblum, managing partner with the investment firm Foothill Ventures. He says promising start-ups can now raise enough money to jump from the research lab to the factory in just a few years, partly because more venture firms now understand the technology. “The ecosystem that’s developing around these kinds of scientific founders is new,” he says. “You have a group of deep-tech investors . . . who can do the due diligence and support the company.”



Cell-grown meat to move closer to dinner plates

by Matt Blois
Several metal fermenation tanks growing meat cells for Upside Foods.
Credit: Upside Foods
Upside Foods is the first company to convince the US Food and Drug Administration that its cell-grown meat is safe.


US regulators could green-light cell-grown meat this year.

Chemistry will be key for lowering the cost of media for growing cells.


Companies growing meat from animal cells are poised to take big steps forward in 2023 after reaching a major regulatory milestone for the industry last year.

In November, the US Food and Drug Administration said it didn’t dispute Upside Foods’ studies claiming that its cell-grown chicken is safe. The company still needs regulatory approval from the Department of Agriculture before it can sell its product in the US.

Claire Bomkamp, a scientist at the Good Food Institute, a think tank, says that could happen before year-end. More importantly, she says, the FDA’s announcement is a sign that the industry is gaining momentum. “It gives a slightly clearer picture of what the regulation is going to look like for other companies,” she says.

We intentionally built our submission to be copied, built upon, and used by others.
Eric Schulze, vice president, global scientific and regulatory affairs, Upside Foods

Eric Schulze, who oversees regulatory affairs at Upside, expects the firm’s accomplishment to help others move more quickly. “We intentionally built our submission to be copied, built upon, and used by others,” he says.

Clearing regulatory hurdles isn’t the only challenge for cell-grown-meat companies. To compete with traditional producers, they will need to lower costs. That means finding cheaper chemicals for the media used to grow animal cells. Those chemicals represent the bulk of costs for producing cell-grown meat.

Upside’s cell culture medium includes amino acids, fatty acids, sugars, trace elements, vitamins, and recombinant proteins. The most expensive components are the proteins, including growth factors and albumin. Cells need only small amounts of growth factors but require substantial amounts of albumin—making a low-cost source a must, Bomkamp says. Researchers are trying to find cheap plant proteins to replace animal- derived or recombinant albumin. “My hope is that it would be something fairly simple,” she says.

Schulze says Upside is working on ways to reduce costs but that it will take years for the price of cell-grown meat to match that of conventional meat. In the coming months, he adds, the focus will be on getting consumer feedback for the first time and making the chicken taste more “ideally chicken-y.”


Biobased Chemicals

Fermentation will grow as a way to make chemicals

by Craig Bettenhausen


Improved process engineering is enabling larger-volume chemical fermentation.

Genetic engineering is opening up more molecular targets to microbial manufacturing.


Most consumer-facing markets are seeing increased demand for low-carbon, plant-based products. In 2023, the volume and diversity of biobased chemicals made via fermentation will grow as microbe engineering gets better and synthetic biology unlocks a wider range of molecular targets.

One example of this trend is the growth of the industrial biotechnology firm Genomatica, which is rapidly commercializing fermentation routes to large-volume chemicals normally made from petroleum. Biobased 1,4-butanediol (BDO)—a starting material for many foams, plastics, and fibers—has been a star performer for the company.

The firm licensed its bio-BDO process to the bioplastics firm Novamont, which started up a 30,000-metric-ton-per-year plant in Italy in 2016. More recently, it licensed the technology to Qore, a joint venture between the chemical distributor Helm and the agriculture giant Cargill. Lisa Kennedy, Genomatica’s vice president for strategic partnerships, says she expects Qore to open a plant in Iowa in 2024 that is twice as big as the Italian facility. Qore already has the spandex maker Lycra signed up as a customer.

A man in a spandex Iron Man costume takes a phone call.
Credit: Shutterstock
Industrial biotechnology is bringing biobased versions of existing synthetic polymers, like spandex, to market.

Steve Weiss, a consultant who works with Genomatica and other biobased fuel and materials companies, says buy-in from such major firms is a strong endorsement of synthetic biology’s ability to compete at large scale with synthetic chemistry. “You wouldn’t expect companies like Cargill and Helm to proceed with a project like that unless the economics were solid.”

Kennedy says Genomatica is also pursuing projects to make butylene glycol, caprolactam, hexamethylenediamine, and other small molecules.

Similarly, the gene-editing and strain-optimizing powerhouse Ginkgo Bioworks dotted 2022 with announcements of new customers looking for its help to produce organic acids, personal care ingredients, enzyme catalysts, and medicines. The firm says many more partnerships will become public in 2023.

Weiss expects to see growth in 2023 in the types of molecules that companies are making by fermentation—especially flavors, fragrances, and other specialty chemicals. He also says fermentation will continue to edge toward larger volumes. “I think the trend lines are good that this may be a field that’s beginning to come up to speed and put numbers up on the scoreboard.”



Chemical firms will standardize digital platforms

by Rick Mullin
Dow will replicate a digital operations platform developed for its complex in Freeport, Texas, at several facilities around the world this year, including one in Map Ta Phut, Thailand (shown).
Credit: Dow
Dow will replicate a digital operations platform developed for its complex in Freeport, Texas, at several facilities around the world this year, including one in Map Ta Phut, Thailand (shown).


One-off digitalization projects will be consolidated.

Employee adoption will be a key focus.


The chemical industry has invested heavily in information technology over the past 5 years, implementing a framework on which to convert most if not all of its operations to digital ones. Digitalization, as it’s called, has moved into a new phase of consolidation and standardization that will likely define IT strategies this year.

“I think in ’23 we will see chemical companies pushing their digital strategies to scale, by which I mean moving from one-off proof of concepts here and there to enterprise-wide impact,” says Adam Rothman, an analyst at Boston Consulting Group. The effort, he says, will emphasize employee adoption of digital tools.

David Yankovitz, a chemical analyst at Deloitte, says companies will capitalize on years of heavy investment in core IT infrastructure​—projects that have introduced mobile devices, sales portals, and a shift of enterprise computing to the cloud. Rothman and Yankovitz concur that the next phase of investment across the industry will center on improving supply chain resilience and on transparency, particularly in managing carbon dioxide emissions.

Henrik Hahn, chief digital officer at Evonik Industries, agrees with the consultants. He adds that much of the benefit to be gained at this point will accrue from consolidating so-called lighthouse projects done in isolation and implementing a standard for deploying digital technology.

Our focus is going to be driving further adoption of what we’ve implemented to really get the most out of the capabilities.
Melanie Kalmar, chief digital officer, Dow

“In the past there were lighthouse topics, like having an online shop, doing social media outreach, doing data analytics,” Hahn says. “This is all now part of a framework approach where we more and more elaborate a standard procedure that, in the end, scales within the company.”

Melanie Kalmar, chief digital officer at Dow, also emphasizes the importance of working toward a standard digital infrastructure. Dow has put $400 million into digital platforms in recent years, she says. “Our focus is going to be driving further adoption of what we’ve implemented to really get the most out of the capabilities.”

Dow is also bringing employees up to speed in a new world of work by presenting technologies as “digital assists,” Kalmar says. “It’s not just, ‘Here’s a tool you will use in your job.’ It’s, ‘Here is how we are going to change how you do your job because you have these tools’ ”.


Research Funding

New research security requirements, oversight coming for scientists and universities

by Andrea Widener


The first parts of a US research security directive aimed at identifying and preventing foreign influence will go into effect in 2023.

Uniform reporting requirements for conflicts of interest will be the first rule to go into effect.

Universities should get guidance on what their new research security offices need to do.


A year ago, the US Office of Science and Technology Policy (OSTP) released guidelines designed to make academic research funding more transparent and less vulnerable to foreign interference.

In 2023, many of the requirements, which stem from the National Security Presidential Memorandum-33 (NSPM-33) during the administration of Donald J. Trump, will become reality for scientists and universities seeking federal funding.

The first requirement will be new disclosure forms that agencies use to collect information about a principal investigator’s funding sources. The goal is to make those forms—the biographical sketch and a list of current or pending funding—the same across all federal research agencies. The standardization is intended to streamline work for scientists applying for grants and eliminate confusion about what they need disclose to the government.


National Science Foundation actions against people or institutions with connections to foreign talent programs

  • 31

    Grant awards suspendeda

  • 20

    Grant awards terminated

  • 15

    Government-wide suspension from applying for future grants, for 9 researchers and 4 institutionsb

  • 4

    Individuals barred from getting future federal funding; 2 institutions were debarred

  • 16

    Individuals barred from serving as reviewers

a A small number of suspensions were lifted based on the Office of Inspector General’s recommendation or an institution’s response. b One researcher and one entity were suspended twice. Note: Count as of March 23, 2022. Source: National Science Foundation

Universities are concerned that individual agencies will be able to add their own questions above what is required in the form, says Deborah Altenburg, associate vice president for research policy and government affairs at the Association of Public and Land-grant Universities. Schools want to “make sure that the bar is very high if you’re going to allow agencies to add something, because then you’ve made it different,” which defeats the point of a universal form, she says.

Another requirement is that universities with over $50 million in US funding must create their own research security offices to oversee cybersecurity, foreign travel security, research security training, and export control training.

Rebecca Keiser, chief of research security, strategy, and policy at the National Science Foundation (NSF), says that after an internal review, all the requirements will go out for public comment—hopefully sometime this month. “We’re all really anxious to get these draft standards out as soon as we possibly can,” she says, because universities are eager to move forward.

Training for scientists is another part of the new mandates. The CHIPS and Science Act, which Congress passed in July 2022, required the NSF to fund training modules that university research security offices can use. Those contracts were scheduled to go out in December, and Keiser hopes the resulting training will be available before the end of 2023.

The NSTC is just starting work on another NSPM-33 requirement: common consequences across agencies for failing to report foreign funding or other conflicts. Until now, most consequences have been handled case by case, Keiser says, and that complicates the process. “We want to be really careful that we don’t overgeneralize, but we also want at the same time to be very clear about what could trigger particular consequences,” such as termination of a grant or referral to law enforcement, she adds.

The NSF previously announced that it would start using an artificial intelligence tool to search for unreported conflicts of interest or foreign interference. Keiser says that will happen as soon as guidelines for how the tool will be used come out, hopefully this month.



US agencies will release plans for immediate public access to publications and data

by Andrea Widener


Plans for how US research funders will implement immediate open access to publications and data are due this year.

The plans include access to data, whether they underlie a publication or not. An NIH data-sharing plan goes into effect in January.


Scientists and publishers are eager to see US government agencies’ plans to give the public immediate access to publications and data created from federally funded research.

In August, the US Office of Science and Technology Policy (OSTP) announced that it would require immediate open access for its funded research, and agencies’ policy plans are due this year. A 2013 plan had made research publicly available a year after publication for agencies that fund over $100 million in research. The new plans include immediate availability for both publications and data.

The requirement extends to all federal agencies. Plans from larger funders are due in February; smaller funders, which are creating open-access plans from scratch, have until August.

Agencies seem enthusiastic about the possibilities of the plans they’re developing, says Heather Joseph, executive director of the Scholarly Publishing and Academic Resources Coalition (SPARC), an organization of libraries and academic institutions that promotes open access. “It’s a sea change in how the agencies are approaching it.”

At the end of the day, data are the catalysts for every biomedical discovery.
Lyric Jorgenson, acting associate director for science policy, National Institutes of Health

The National Institutes of Health (NIH), which has been at the forefront of public access among agencies, has already created a data openness plan that will go into effect this month. Making publications available isn’t enough, says Lyric Jorgenson, the NIH’s acting associate director for science policy. “At the end of the day, data are the catalysts for every biomedical discovery.”

Just like the OSTP directive, the NIH plan applies to data whether or not they underlie a publication. “A ‘no’ finding is just as important as one that gets put in the journal. It is very important that we get that information out there,” Jorgenson says.

The NIH has tried not to be prescriptive about how a scientist’s data are made available, she says, since it is dealing with many types of data and different data-sharing cultures.

The same is true for the OSTP, which is not telling scientists how to make their publications available. They may publish open access—many federal funders allow payments, when required, to be charged to their grant—or place them in a repository.


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