04 September 2008 16:29 [Source: ICIS news]
By Joe Kamalick?xml:namespace>
Indeed, export sales of chemicals and other manufactured goods are fairly credited with saving the
“Exports are vital to the
“Over the past year - second quarter 2007 to second quarter 2008 - the
“Nearly two-thirds of that growth, 61%, came from exports, which increased by 11.2% during that period,” he said.
“Strong growth abroad, which has averaged 3.9% over the past three years (on a trade-weighted basis) and a more competitive dollar have made US manufactured exports more competitive globally,” Huether added.
That strong global growth has helped sustain the
“Exports are very important to American chemistry, accounting for 23% of shipments for overall chemistry - and 25% of chemicals excluding pharmaceuticals,” Swift said.
“According to the Bureau of the Census, exports support 16% of the chemical industry’s jobs, with an additional 8% of industry jobs supported by the exports of other industries that depend on the domestic availability and quality of American chemistry,” Swift said.
That is 207,000 chemical industry jobs tied directly or indirectly to export trade, said Swift.
“Looking at the details of some of the resins,” said Swift, “exports have been very supportive at a time when domestic demand has been soft.”
“The July HDPE [high density polyethylene] figures just came out and indicated that while domestic sales thus far this year were down 6.2% for the first seven months compared with the same period in 2007, exports were up 59.6% during the same time,” he said.
“Similarly, domestic sales of polystyrene [PS] were down 3.7% for the first seven months this year compared with the same period in 2007, with exports up 2.1%.”
“The question is,” Swift said, “how long can this go on?”
The International Monetary Fund (IMF) said that “the slowdown in global growth, which started in mid-2007, is expected to continue through the second half of 2008, with only a gradual recovery during 2009”.
“Global growth decelerated to 4.5% in the first quarter of 2008, measured over four quarters earlier,” the IMF said in its recent world economic outlook, “down from 5% in the third quarter of 2007, with activity slowing in both advanced and emerging economies.”
In addition, “recent indicators suggest a further deceleration of activity in the second half of 2008,” the IMF said.
“Accordingly, global growth is projected to moderate from 5% in 2007 to 4.1% in 2008 and 3.9% in 2009,” according to the fund’s forecast.
“Expansions in emerging and developing economies are expected to lose steam,” the IMF said. “Growth in these economies is projected to ease to around 7% in 2008-2009 from 8% in 2007.”
Growth projections for the euro area and
Consequently, at least some of the strong foreign growth that has sustained US chemical and other manufacturing over the past year and more can be expected to wane this year and into 2009.
As the export market begins to cool, will the
The IMF said that
But the fund also expected the
As August drew to a close, the US Commerce Department revised its estimate of the nation’s GDP in the second quarter to a 3.3% rate of growth, up sharply from the department’s earlier estimate of 1.9% GDP expansion in the quarter.
The question is whether the hoped-for
Joe Acker, president of the Synthetic Organic Chemical Manufacturers Association (SOCMA), said that there is another factor in the balance between domestic and foreign markets - the quality and dependability of
“While there is no question that the weaker US dollar has helped our exports, there are other factors,” Acker said.
“As those developing economies begin to cool and as costs are coming up in
In other words, even if the domestic
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