This past year was one of the best in a decade for the chemical process industries (CPI), according to the American Chemistry Council’s (ACC; Washington, D.C., www.americanchemistry.com) year-end report [ 1]. The report details that output of U.S. chemical producers grew by 3.9% and chemical industry capital spending grew 9.0% to $33.5 billion in 2022. Much of the investment went toward capacity expansions, upgrades and sustainability projects, such as for recycling and development of lower-emissions technologies. The gains this past year were made despite serious headwinds, including supply-chain disruptions, energy price fluctuations and worldwide economic uncertainties due largely to the war in Europe, as well as ongoing effects from the pandemic.
As these challenges continue to varying degrees, and with the economy struggling with inflation, Martha Moore, ACC chief economist and author of the report [ 1] says “We anticipate a shallow recession beginning in early 2023 followed by recovery in the latter part of the year.” Relatively healthy balance sheets for U.S. chemical companies are cited in support of the expected recovery.
We have seen for some time now that trends in the CPI include numerous topics in support of sustainability goals including: carbon reduction through abatement, such as carbon capture; reduction of fossil-fuel use and advances in alternate energy sources; decarbonization through use of alternative feedstocks; electrification of processes; a focus on circularity, such as through advanced recycling, and digitalization for efficiency and to stay competitive. Readers will likely have noticed that these topics tend to dominate the latest news on our website (www.chemengonline.com). We have, in fact, expanded our e-newsletter offerings to include more of these sustainability topics. We have also initiated an e-newsletter focused soley on developments around hydrogen.
In its 2023 Chemical Industry Outlook, Deloitte (www.deloitte.com) writes about the transformation of the chemical industry, which it says is “needed to meet the clear imperatives for circularity, decarbonization and sustainability.” The Deloitte report breaks down the industry trends into four segments: (1) Sustainability and innovation; (2) Portfolio transformation; (3) Supply chains; and (4) Digital technologies. The sustainability and innovation segment includes several of the topics noted above, and the Deloitte report elaborates, saying that “the majority of the challenges with ESG (environmental, social and governance) implementation are associated with a lack of low-carbon alternatives or the cost of abatement.” (For more on ESG, see pp. 35–39.)
And while the ACC reports that supply-chain bottlenecks have been easing, they are still a major concern and the industry is evaluating supply-chain structures. The Deloitte report notes that one response has been to create local feedstock systems through bio-based and recycled materials that are also sustainable. Digital-technology is also being applied to help alleviate challenges, such as those associated with supply-chain management.
There are many exciting developments taking place in the CPI and we look forward to covering them as they unfold. Our best wishes to all for a happy and healthy new year.■
Dorothy Lozowski, Editorial Director