HOUSTON (ICIS)--US chemical output will rise in 2017 and continue growing for the next three years, the American Chemistry Council (ACC) said on Friday.
Output is rising just as the major global economies are expanding in unison, the ACC said.
"American chemistry is riding a synchronised global upswing," said Kevin Swift, chief economist of ACC and lead author of a report providing a year-end outlook. "Manufacturing has turned a corner, business investment is on the rise, and domestic oil and gas production is on the rebound. It all sets the stage for tremendous momentum, expansion and capital investment."
US chemical production is expected to rise by 0.8% in 2017, excluding pharmaceuticals, the ACC said. It should increase by 3.7% in 2018, 3.9% in 2019 and 3.0% in 2020.
Basic chemicals production should be flat in 2017 before rising by 4.7% in 2018 and 5.2% in 2019.
For specialties, production should rise by 3.0% in 2017 and 2.3% in 2018. The sector is benefitting from improvements in oilfield and mining chemicals, adhesives and electronic chemicals.
The US should have a chemical trade surplus of $32bn in 2017, excluding pharmaceuticals, the ACC said. Exports rose by 4.9% to $127bn, and imports rose by 2.8% to $96bn. Two-way trade between the US and its foreign partners will reach $223bn in 2017, up 4.0%.
The growth in the nation's chemical industry comes amid a wave of new plants starting up. Companies have announced nearly 320 chemical projects worth $185bn. Out of this amount, 62% is foreign direct investment.
Nearly 65% of the investments announced since 2010 has either been completed or is under construction.
In addition to new projects, capital spending continued to rise, reaching $38bn in 2017, up 6.0%. It should rise by 6.3% in 2018 and 6.8% in 2019. By 2022, spending should reach $48bn.
US chemistry is a $768bn industry, accounting for more than 14% of all US exports and 15% of the world's chemicals, the ACC said.