Chemicals & The Economy

The above chart, based on data from the excellent weekly American Chemistry Council report, highlights the changes in chemical production over the past year.

November saw world production (black line) finally turn positive again versus the previous 12 months, for the first time since August 2008. For an industry used to steady growth in line with GDP, the past 15 months have been traumatic. And, of course, as the ACC note, total production in 2009 seems likely to be down 3.8% versus 2008.

The strength of China's recovery is also highlighted in the chart, with Asia Pacific output (dotted brown line) up 8% versus November 2008. N America (blue) and W Europe (green) also saw production rebound, although at a slower 3% rate. This was in line with the Middle East's performance (purple), although the latter was more impressive as it grew steadily till May 2009, before entering a shallow downturn.

Still showing negative annual growth are Latin America (pink), down 4%, and Central/Eastern Europe (light blue), down 9%. This highlights how those with small domestic regional markets have been worst affected by the overall fall in demand. Hopefully, though, these regions will also soon start to see a return to annual growth during 2010.