U.S. Chemical Production Faces Challenges in 2024 Amidst Economic Uncertainty
- Geeth Liyanage
- Oct 19
- 2 min read
By Synovate Team
The U.S. chemical manufacturing industry experienced a modest decline in 2024, with output falling by 0.4% compared to the previous year. This downturn follows a 0.2% decrease in 2023, reflecting ongoing challenges in key end-use markets. The American Chemistry Council (ACC) attributes this decline to weak demand across various sectors, including automotive, construction, and consumer goods.
Sector-Specific Performance
Despite the overall decline, certain segments within the chemical industry showed resilience:
Plastic Resins: Production increased by 2.3%, driven by strong export demand.
Agricultural Chemicals: Output rose by 1.2%, supported by steady demand for crop protection products.
Consumer Products: Continued growth with a 5.0% increase, reflecting sustained consumer spending.
Conversely, sectors such as specialty chemicals and basic chemicals faced declines due to sluggish recovery in end-use markets.
Regional Variations
Regional performance varied across the United States:
Gulf Coast: Continued to be a stronghold for chemical production, benefiting from proximity to raw materials and export facilities.
Midwest: Showed signs of recovery, with increased manufacturing activity contributing to a rebound in chemical output.
Other Regions: Experienced stagnation or decline, influenced by local economic conditions and industry-specific challenges.
Economic Outlook for 2025
Looking ahead, the ACC projects a 1.9% growth in U.S. chemical production in 2025. This anticipated recovery is contingent on several factors:
Interest Rates: Lower rates are expected to stimulate investment and consumer spending.
Industrial Demand: A rebound in key sectors such as automotive and construction could drive chemical consumption.
Global Trade: Strengthening export markets may bolster production in export-oriented regions.
The U.S. chemical manufacturing industry navigated a challenging 2024, marked by economic uncertainties and sector-specific declines. However, with projected growth in 2025, there is cautious optimism for a recovery, contingent on favorable economic conditions and revitalized demand across key markets.
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