U.S. Chemical Production Drops 1.5% in December

Jan. 26, 2023
The Gulf Coast region experienced the greatest decline, with bad weather significantly impacting production

Bad weather contributed to a 1.5% drop in U.S. chemical production for the month of December, according to the U.S. Chemical Production Regional Index released by the American Chemistry Council (ACC) on Jan. 25.

The drop follows national declines of 0.8% in October and 0.3% in November. Chemical output was lower than the previous month in all regions. But the Gulf Coast region, home to much of the nation’s basic industrial chemical and synthetic materials capacity, experienced the greatest decline.

“Many factors contributed to the continued drop in chemical production as bad weather and declining demand tapped the brakes on chemical production to close out the year,” said Martha Moore, ACC’s chief economist. “Some chemistries were bolstered by stronger output for staples such as food & beverages and apparel along with vehicles and appliances.

The declines reflect not only, declining output across multiple key end-use industries and weak export markets, but also disruptions from winter storm Elliott that hit in late December. Many chemical facilities along the U.S. Gulf Coast shut down in preparation of the freezing temperatures.

The U.S. CPRI is measured as a three-month moving average (3MMA) and was developed by ACC to track chemical production activity in seven regions of the United States.

On a 3MMA basis, chemical production within segments was mostly negative in December. Only fertilizer output was higher. Production in all other segments was down compared to a month earlier.

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