If the chemical industry were a movie, last year could be titled "2001Part 2." Many of the problems that beset the industry around the world in the prior year just continued: lackluster demand; rising costs that were only partly offset by moderately higher selling prices; and for many of the countries surveyed, including now the U.S., a widening chemical trade deficit.
Despite the economic malaise, chemical company earnings around the world increased. But the increase came largely because of cost cutting by the firms. And a big part of the cost cutting involved reducing employment, often at an even greater rate than in 2001.
The data in this year's Facts & Figures for the Chemical Industry show, in great detail, the economic conditions around the world in what is hoped to be the last year of general downturn before a recovery sets in.
And this edition of our annual wrap-up of the chemical industry has greater detail than ever before. For instance, almost all tables show 11 years of data to present decade-long trends. But more important, to reflect the international nature of the chemical industry and to increase comparability between countries, all data have been reorganized into just four sections--Finance, Production, Employment, and Tradewith each containing the relevant data for the major chemical-producing nations of the world.
Two other significant changes were made for the sake of comparability: All volume units are given in metric tons or, when necessary, cubic meters. In addition, all production, employment, and price indexes use a base year of 1997 for comparison.
The collection of all of the statistics from around the world that make up Facts & Figures has been the work of Assistant Managing Editor Michael McCoy, Senior Correspondent Marc Reisch, and Associate Editor Alexander H. Tullo (all three in C&EN's Northeast News Bureau); Senior Correspondent Patricia L. Short (London); Houston Bureau Head Ann M. Thayer; and Asia-Pacific Bureau Head Jean-François Tremblay. The effort was coordinated by Senior Correspondent William J. Storck (Northeast News Bureau).
Assistant Managing Editor Robin M. Giroux was instrumental in the organization of the data, and Art Director Robin L. Braverman made it work graphically.
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Chemical companies didnt exactly see finances deteriorate in 2002, but any progress they made was largely due to cost reorganizations and cost-cutting measures that they instituted during the year. Operations were sold off, plants were closed, and jobs were cut as chemical producers struggled to make headway against higher raw material costs and lackluster growth in product demand. Research and development and capital spending also were cut to save money.
As the fate of the worldwide chemical industry goes, so goes employment. In good times, companies add employees. In bad times, chemical employment rolls fall faster than the fortunes of the industry might signify.
Chemical production in the countries surveyed by C&EN generally enjoyed a slight recovery last year. This is, at least, a positive note for the industry, but the growth rates were greatly variedfrom a 3.8% year-to-year decline in the French production index for all chemicals to a 9.2% rise in the index in Belgium.
Internationally, foreign trade is a zero-sum business activity. When exports are totaled for all countries, the sum is equal to that of imports. But that is certainly not true of individual countriesas the U.S. has lately learned.
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Copyright © 2003 American Chemical Society