Chemicals Industry Trends July 2024

Investment Rating - The chemical industry is rated with an uneven long-term outlook, with a forecasted production increase of more than 3% in 2024 and 2025, driven by a rebound in the US and Western Europe [2][4]. Core Insights - The chemical industry faced significant challenges due to the energy crisis in 2022 and 2023, resulting in a global output growth slowdown to 0.7% in 2022 and 1.2% in 2023, primarily sustained by increases in the Asia Pacific region [2][4]. - The US and Western Europe are expected to experience a recovery in 2024, supported by lower energy prices and recovering demand from key buyer sectors [2][4]. - Asia Pacific remains the main driver of chemicals growth, followed by the US, while Europe faces competitive disadvantages due to higher energy prices [2][4]. Summary by Region Americas - The US chemical production contracted by 0.6% in 2023 but is expected to rebound with growth of more than 3% annually in 2024 and 2025, supported by government policies and stable shale gas prices [20]. - Brazil's chemical output is forecasted to decline by 0.3% in 2024, while Canada and Mexico are also expected to see modest growth in the coming years [20]. Asia Pacific - China's chemical production growth is expected to slow to 4.7% in 2024 and 3.1% in 2025, while India's output is forecasted to increase by 4.1% in 2024 and 6.5% in 2025, driven by robust domestic demand [22]. - Japan's chemical output is projected to decrease by 0.9% in 2024, reflecting challenges in the construction-related sector [22]. Europe - The Eurozone's chemical production is expected to grow by 4.1% in 2024 after a significant contraction in previous years, driven by lower energy prices and rising demand from key industries [23]. - Germany, as the largest chemical producer in Europe, is forecasted to see a rebound of 7.7% in 2024, although long-term competitiveness remains a concern due to higher energy costs [23].