US chemical output up by 3.6pc in 2015: ACC

OREANDA-NEWS. December 24, 2015. US chemical production grew by 3.6pc in 2015 and is forecast to grow 2.9pc in 2016 and by 4.4pc in 2017, according to the American Chemistry Council (ACC).

Even as the higher value of the dollar creates headwinds for US exports, domestic demand from the automotive and housing sectors will support production growth for petrochemicals, according to the trade group's annual report.

"Strong growth is expected in inorganic chemicals, organic chemistry, plastic resins and synthetic rubber as export markets revive and domestic end-use markets further improve," the report said.

The ACC estimates 2015 capital spending by petrochemical producers rose by 18.4pc as companies invested in new cracker expansions to take advantage of cheap shale-derived feedstocks. Further investments are expected to increase more than 7pc annually through 2018 to as much as \\$55.3bn by 2020.

"It is estimated that the gains to basic olefins capacity will range from 35pc to 40pc," the group said. "Over 255 new chemical production projects (valued at over \\$158bn altogether) have been announced through early December and the dynamics for sustained capital investment are in place."

Increased US production will lead to growth in exports, according to the ACC, which estimates the US will post a \\$34bn trade surplus in 2015 that could grow to \\$59.1bn by 2020.

US production of plastic resins grew by 3.1pc in 2015 and is forecast to grow by 3.9pc next year. Synthetic rubber production grew by 3.1pc this year and is forecast to grow by 3.9pc in 2016. The ACC estimates 2015 capacity utilization stood at 74.6pc.