Sales of chemicals will top $1 trillion by 2018, driven by an uptick in production of natural gas from shale, demand for plastic resins and revival of export markets, according to the American Chemistry Council.
The ACC’s Chemical Industry and Outlook report projects that US chemical production will rise 2.5 percent in 2014 and 3.5 percent in 2015. Strong growth is expected for plastic resins and organic chemicals, helped by export markets, ACC says.
Shale gas and the surge in natural gas liquids supply has helped move the US from being a high-cost producer of key petrochemicals and resins to among the lowest cost producers in the world, the ACC says. As a result, exports are surging. The US industry, which once had a chemicals trade deficit, is expected to have a surplus in 2013 of $2.8 billion. The surplus is expected to reach nearly $30 billion from almost $300 billion in total exports by 2018.
In 2013, output grew 1.6 percent — an improvement over the negligible 0.1 percent gain in 2012. During 2013, growth improved across all US regions, notably the Ohio Valley, which saw gains in specialties and consumer chemistry.
The chemicals industry also added more jobs in 2013 — the first time since 1999 — with employment growing 13 percent. The industry is expected to continue to add jobs through 2018, the ACC says.
The industry is expected to increase its spending on research and development 2.5 percent to $58.billion in 2014, the ACC says. Annual R&D spending will reach $68.7 billion by 2018.
US demand for water treatment chemicals will rise 3.2 percent per year to reach $6.7 billion in 2017, an increase driven by growth in the oil, gas and mining industries and a rebound in manufacturing production, according to a study released in October by the Freedonia Group.
The Cleveland, Ohio-based industry market research firm says that demand also will rise as more companies use chemicals to protect their investments in water treatment equipment.