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CPI Outlook for 2024

| By Dorothy Lozowski

Following a strong year for the chemical process industries (CPI) in 2022, 2023 saw modest growth, with global industrial output rising only 0.6% and chemical production growth at about 0.3% [ 1]. Numerous factors contributed to the lower demand for chemical products, including inflation and the de-stocking of very high inventory levels that resulted from critical supply-chain disruptions and over-ordering in the previous years.

In 2024, global industrial output is expected to pick up by 1.8% and global chemical production is expected to grow by about 2.9%, according to the American Chemistry Council’s (ACC; Washington, D.C.; year-end report [ 1]. The report also indicates that while an economic downturn is expected in the short-term, longer term prospects for U.S. chemical production are positive, with continuing energy advantages in the U.S., an expected modest increase in demand as high inventory levels are depleted, and initiatives to promote “clean” energy and domestic production.



The ongoing energy transition is a strong driver for chemical demand. The move toward renewable energy sources and increasing decarbonization goals depend strongly on the CPI for materials and support. For example, while the ACC estimates that approximately $4,000 of chemical products are contained in an average automobile, electric vehicles (EVs) require even more chemistry-based components, such as high-performance polymers and battery components. And, EV sales are on the rise, accounting for a record 7.9% of total industry sales in the third quarter of 2023 according to Cox Automotive (

In the U.S., government initiatives, such as the Infrastructure Investment and Jobs Act (IIJA), the Inflation Reduction Act (IRA), and the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act, are driving investments into sectors that require materials from the CPI. The impact of these policies is expected to boost chemicals production in the long term.

CPI products play an important role in decarbonization goals to reduce emissions. In its 2024 Outlook [ 2] Deloitte ( points out that “the chemical industry supports more than 75% of all emissions reduction technologies needed to meet net-zero goals by 2050,” citing products such as battery materials, refrigerants for heat pumps and lubricants for wind turbines, as well as technologies for recycling, particularly for plastics and batteries. Deloitte expects these needs to increase demands for CPI products in 2024 as more projects come online.



The overall long-term outlook for the CPI is positive, with strong drivers as mentioned above. The ACC report reminds us of potential risks that could affect the expected outlook. Those risks include financial volatility, geopolitical conflicts, regulatory impacts and disruptive events, such as from weather. ■


Dorothy Lozowski, Editorial Director


1. American Chemistry Council, ACC Year-End Situation and Outlook, November 2023,

2. Deloitte Research Center for Energy & Industrials, 2024 Chemical Industry Outlook,