08 May 2007 16:22 [Source: ICIS news]
The National Association of Manufacturers (NAM) said a study it commissioned shows that: “As a result of the increase in the cost and availability of chemicals - a vital raw material for most manufacturers - 25% of US manufacturing will move some production overseas if current conditions persist.”
The study, done by AMR Research and funded by
The report said that without relief from those increasing costs, 25% of US manufacturers will move some production overseas. Across all companies that plan to move production offshore, said the study, the average amount of production shifted will be 32%.
“The impact of rising costs is severe given that most manufacturers depend on chemicals for some form of production and, as a raw material expense, chemical costs are a key driver of profitability,” said the study.
Kevin O’Marah, AMR senior vice president and co-author of the report, said: “The most immediate and obvious risk is to the resilience and competitiveness of
“But less obvious and more troubling,” he said, “is the consequence of an over-reliance on offshore suppliers.” He said increasing
“Chemicals are a critical link in the supply chain for two-thirds of US manufacturers, but
“At stake is not only the future health of chemical manufacturing firms, but also the thousands of companies that use their chemicals to make everything from crayons to computers,” Engler added.
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