US chemical production expanded at a slower pace in 2019 because of trade challenges and slower growth in several end-use markets for chemistry, according to the American Chemistry Council’s (ACC’s) report Year-End 2019 Chemical Industry Situation and Outlook. The report attributes weakness in global manufacturing and uncertainty in trade policy as reasons why US chemical output growth will moderate in 2020. In contrast, new shale-gas capacity will bolster growth in the region.

The report indicates that the total US chemicals trade is projected to contract by 3 percent to $242 billion in 2019, then recover by 1 percent in 2020. Exports will fall 2.5 percent to $137 billion in 2019 before expanding by 1.1 percent to $138 billion in 2020. US chemicals imports will fall 3.9 percent in 2019 to $105 billion.

Industrial chemical output grew only 0.9 percent in 2019 as trade tensions disrupted supply chains, energy investment eased, and slower growth in key trading-partner economies negatively affected demand for US exports. Chemical output is expected to decrease further in 2020 and then strengthen in 2021. The largest gains in end-use industries are expected to be in construction materials, oil and gas extraction, refining, semiconductors, and aerospace.

The specialty chemicals market had solid growth in 2019, but many specialty market segments started to decrease at the end of 2019. In total, this part of the chemical market is expected to have 2.6 percent growth for 2019. In 2020, end-use market demand is expected to ease further and energy investment to fall, so a small 0.4 percent decline is expected. Specialties growth may resume as the industrial sector recovers in 2021 and beyond. The full report is available for purchase at The ACC, Washington, DC, represents companies engaged in the business of chemistry.