Prospects for the US and European chemical markets in the second half of the year

Although supply chain constraints and the new crown pneumonia epidemic have affected market demand in some parts of the world, the prospects for chemical production in the United States in the second half of 2021 remain strong
.

ACC chief economist Kevin Swift said: “The global macroeconomic environment is quite good.
Although some emerging markets, such as India and Brazil, are lagging behind due to the speed of vaccine promotion, the economy is slowly recovering
.

Strong end market demand

ACC predicts that US industrial production will increase by 5.
5% in 2021 and 4.
3% in 2022, while US industrial production will fall by 6.
7% in 2020, with the decline mainly concentrated in the second quarter
.

Dow Chemical predicted in early June that the pre-interest, tax, depreciation and amortization profit for the second quarter of 2021 was US$400 million to US$500 million higher than the agency’s forecast
.

　　The JPMorgan Chase Global Manufacturing PMI Composite Index released by JPMorgan Chase and Esson Huamai on July 1 showed that the global manufacturing industry was still in a strong growth phase in June, with output, new orders and employment all increasing
.

　　Supply chain constraints still exist

　　Although the demand outlook is optimistic, there are some risks in the chemical and end-demand markets
.

　　Supply chain constraints have been a persistent problem for several months, and it is likely to continue
.

　　Supply chain constraints also affect the end-use market, which may inhibit chemical demand
.

　　At the same time, although the high vaccination rate in the United States is supporting a strong recovery, the global spread of the new crown pneumonia epidemic has not completely disappeared
.
The crisis persists, especially in developing countries
.

　　European chemical companies are generally optimistic

　　The German Chemical Industry Association (VCI) announced in June that due to the good performance of the industry in the first quarter, the association raised its expectations for the production and sales of German chemicals this year
.
Currently, VCI predicts that German chemical production will increase by 4.
5% this year, prices may rise by 3.
5%, and industrial sales will increase by 8% to 206 billion euros
.
VCI previously predicted that this year's chemical production and sales will increase by 3% and 5% respectively, mainly due to the strong performance of the German industry and the recovering global economy
.
However, VCI stated that supply chain constraints are a major concern for German chemical manufacturers
.

　　European chemical companies are generally optimistic about this year
.
Wacker Chemie has also raised its operating performance expectations for this year.
It is expected that the profit before interest, tax, depreciation and amortization in 2021 will be between 900 million and 1.
1 billion euros, higher than last year's 666 million euros
.
WACKER had previously predicted that the full-year profit before interest, tax, depreciation and amortization would increase by 15% to 25%.
It is expected that sales in 2021 will be approximately 5.
5 billion euros, higher than the 4.
69 billion euros in 2020
.

　　The global chemical distribution giant Brenntag of Germany reiterated its operating guidelines for this year
.
The company expects the total profit before interest, tax, depreciation and amortization for the year to be 1.
09 billion to 1.
18 billion euros
.
The profit before interest, tax, depreciation and amortization in 2020 was 758.
1 million euros
.