On Nov. 27, The American Chemistry Council released its 2023 Year-End Situation & Outlook. The economic report reveals a short downturn in the U.S. economy where demand for chemicals remains weak, both in the United States and abroad.
The report provides a detailed look at economic factors, including both U.S. and world GDP growth, business investments spurred by recent legislation, unemployment and interest rates. The outlook also covers chemical use by end-use markets, chemical production output, trade and capital spending.
Contributing to slower growth is the downturn in the automotive and housing industries, both of which are large end users of chemicals. While growth in vehicle sales is expected to remain flat in 2024, the ACC states chemistry-intensive electric vehicles account for a larger share of vehicle sales in the United States, up to nearly 8% of new sales in Q3, according to Cox Automotive. Housing starts also have fallen from 1.55 million in 2022 to 1.39 million in 2023. With rising unemployment and high borrowing costs, the ACC expects housing to edge lower to 1.35 million in 2024.
The ACC’s longer-term outlook shows prospects for U.S. chemistry “remain positive with competitive energy fundamentals and the resurgence in U.S. manufacturing from once-in-a-generation legislative initiatives to promote clean energy, infrastructure, and a strong domestic manufacturing base.”