The overall economic outlook for the first quarter of 2010 has improved over the end of 2009, although various forces are still constraining recovery, the American Chemistry Council says in a March 18 report on Q1 economics.
The 1st Quarter 2010 Situation & Outlook report indicates that economic prospects have improved, but high unemployment rates and a weak consumer sector will constrain the recovery somewhat. It appears clear, though, that U.S. gross domestic product (GDP) is following a "V-shaped growth trajectory," with a 3.1% rise in GDP for 2010 and a 2.8% increase in 2011, the report states.
In the chemical industry, the report suggests inventories for both producers and downstream companies are lean, and demand is rising, although the gains are being made from previously depressed levels.
Global chemical output has improved from this time last year, and is expected to rise 6.5% in 2010, and expand further in 2011 and 2012, the report says, as the global chemical industry rebounds from the collapse in demand from early last year. Although recovery seems to be occurring across all regions of the world, emerging markets will experience the strongest growth, ACC writes.
The report also says in the U.S., chemical output is expected to increase 7.8% in 2010, 4.0% in 2011 and 3.8% in 2012, after declines in both 2008 and 2009 of around 4.5%.
In addition to the quarterly review, ACC also released its Weekly Chemistry and Economic Trends report, which found that 14 of 20 indicators tracked by ACC are positive for the week ending March 18, down one from the past two weeks. The market capitalization of basic and specialty chemical companies rose by 1.8% over last week, to close at $554 billion. The gain is slightly higher than the S&P 500, which rose by 1.4% last week.