Total production of chemicals in January rose in all geographic regions of the U.S., according to the U.S. Chemical Production Regional Index (CPRI).
Assembled by the American Chemistry Council (ACC; Washington, D.C.; www.americanchemistry.com ) and discussed in the latest ACC Weekly Chemistry and Economic Trends report, the CPRI data indicate that chemical production rose 1.1% in January in the U.S., and is 2.8% higher than a year ago, on a three-month moving average basis. Over the past few months, year-to-year comparisons have been improving for the Gulf Coast, Ohio Valley, Midwest and Southeast regions “with strong demand for U.S. petrochemicals and organic derivatives,” the ACC report says. Year-to-year comparisons for the Mid-Atlantic and West Coast have been steady in recent months, the report adds.
Compared to a year ago, chemical production in Gulf Coast region is 6.8% higher, while the Ohio Valley was 4.7% higher. The Southeast region was 3.0% higher than January 2010, and the Midwest region was up 2.1%. Mid-Atlantic (1.1%), Northeast (0.8%) and West Coast (0.6) were up slightly over a year ago.
In the wider economy, consumer confidence was rose to its highest level in three years, says the report, and existing home sales also rose unexpectedly. Sale prices of existing homes are at a nine-year low, however, and sales of distressed properties continue to account for more than a third of sales, the report notes.
Globally, rising oil prices threaten to derail economic recovery. “Should oil prices rise, on a sustained basis, to above $125/bbl, the effects would be appreciable,” the ACC report states, “with perhaps 0.6 percentage points shaved off this year’s expectations of 3.2% economic growth” in the U.S. Higher oil prices could take a bigger toll in 2012, maybe shaving as much as 1.8 percentage points off the forecasted 3.3% gross domestic product growth in 2012.