WASHINGTON (February 17, 2017) – According to the American Chemistry Council (ACC), the U.S. Chemical Production Regional Index (U.S. CPRI) rose by 0.5 percent in January, following an upwardly revised 0.2 percent gain in December and a 0.4 percent increase in November, as measured on a three-month moving average (3MMA) basis. In January, chemical production was higher across all regions, with especially large gains in the Gulf Coast and Ohio Valley regions, reflecting the relatively large share of basic industrial chemical production in those regions.
Also measured on a 3MMA basis, chemical production was mixed. There were gains in the production output trend of pesticides, organic chemicals, adhesives, coatings, fertilizers, synthetic dyes and pigments, consumer products, other specialty chemicals, and industrial gases. These gains were partially offset by declines in the production of manufactured fibers, plastic resins, synthetic rubber, inorganic chemicals, chlor-alkali, and pharmaceuticals.
Nearly all manufactured goods are produced using chemistry in some form or another. Thus, manufacturing activity is an important indicator for chemical production. On a 3MMA basis, manufacturing activity expanded for a third straight month in January. Production was higher in several chemistry-intensive manufacturing industries, including food and beverages, appliances, construction supplies, machinery, electronics, semiconductors, petroleum refining, iron and steel products, paper, structural panels, printing and furniture.
Compared to January 2016, U.S. chemical production was off 0.6 percent on a year-over-year basis, an improving comparison. All regions experienced declines in year-over-year growth, except the Gulf Coast and Ohio Valley regions which had Y/Y gains and the Midwest region which was flat.
The chemistry industry is one of the largest industries in the United States, a $797 billion enterprise. The manufacturing sector is the largest consumer of chemical products, and 96 percent of manufactured goods are touched by chemistry. The U.S. CPRI was developed to track chemical production activity in seven regions of the United States. The U.S. CPRI is based on information from the Federal Reserve, and as such, includes monthly revisions as published by the Federal Reserve. To smooth month-to-month fluctuations, the U.S. CPRI is measured using a three-month moving average. Thus, the reading in January reflects production activity during November, December, and January.