After a few good years, outperforming broader markets in the past decade, the chemicals industry currently faces significant challenges moving forward. Feedstock cost competitiveness and new markets, two of the more significant market drivers, have a positive outlook. However, other drivers are negative, such as the current direction of interest rates, or neutral, such as limited GDP growth, the rise of inflation, and growing pressure from state of decarbonization, sustainability, and circularity. This post is a recap of a presentation at the ADI Forum in 2023, you won’t want to miss the ADI Forum for all the insights you will gain.
The threat of recession weighs heavily on economic and chemical industry forecasts. Some negative indicators include automobile sales, which will likely end at 15.7 million units in 2023 versus 13.4 million units in 2022, which was the worst in a decade, but still down from 17 million in 2019, and housing starts, which began falling in the fourth quarter of 2022 after significant growth in the past couple of years, with limited growth expected in 2023. Additionally, U.S. chemical exports and the trade surplus began declining in Q4 2022 and is now below 2019 levels. However, some of this slower growth may be offset with infrastructure projects, such as those coming from the Infrastructure Investment and Jobs Act (IIJA). (Exhibit 1)
The rest of this article is available to ADI Plus subscribers.
Log in or subscribe to unlock ADI Plus content >>
Have questions? We're happy to help.
About ADI Analytics
ADI is a prestigious, boutique consulting firm specializing in oil and gas, energy transition, and chemicals since 2009. We bring deep expertise in a broad range of markets where we support Fortune 500, mid-sized and early-stage companies, and investors with consulting services, research reports, and data and analytics, with the goal of delivering actionable outcomes to help our clients achieve tangible results.
We also host the ADI Forum that brings c-suite executives together for meaningful dialogue and strategic insights across the oil & gas, energy transition, and chemicals value chains. Learn more about the ADI Forum.
Subscribe to our newsletter or contact us to learn more.
