The American chemical industry is feeling a bit optimistic about a recovery in the U.S. economy with orders up in the first quarter of 2024. But companies surveyed for the American Chemistry Council's Chemical Manufacturing Economic Sentiment Index (ESI) are careful to balance that hope with worries about future regulations and struggles in global markets.
For the quarter, 57 percent of chemical manufacturers reported the volume of new orders had increased, ACC said. Looking ahead six months, chemical manufacturers anticipate gains in the volume of both domestic and foreign orders.
"For the first time since we started conducting the survey, companies are signaling optimism about economic conditions," Emily Sanchez, director of economics and data analytics at ACC, said in a news release. "That's probably because there has been a significant shift toward improved customer demand and increased production output. Addressing the cost and regulatory challenges will be key to sustaining this optimism and positive trend."
Nearly 60 percent of manufacturers said their regulatory burden was up in the first quarter, while 67 percent expect it to increase in the next six months.
ACC has collected data for the ESI since the first quarter of 2023.
The ESI results match data from the Federal Reserve Board, says Plastics News Economics Editor Bill Wood. Total U.S. production of chemical products was up 2 percent year to date through April vs. the same period in 2023. Total production of plastic products is up about 1 percent so far this year.
The question, he says, is whether those numbers show the start of the next recovery or if it is just false hope that will be followed by another fall. And if it is a recovery, then will it be a long and painful one or one that will accelerate steadily?
Watch for more on the topic from Bill in a Numbers That Matter Shorts video going live later this week.
