Chemical industry in the United States is one of the largest and most prominent industries worldwide. This industry provides essential chemical ingredients ranging from downstream chemicals to high-tech products. The chemical sector is one of the United States’ largest manufacturing industries, serving both a sizable domestic market and an expanding global market. The United States is the world’s largest economy at USD 20.4 trillion, with the chemical sector playing a major role.
The chemical industry in the country
The United States is one of the largest national producers of chemical products globally. The total chemical sales in the United States were more than USD 765 billion in the year 2017. Chemical industry in the United States consists of more than 13,000 firms. These firms produce over 70,000 chemical products. The chemical companies in the United States offer direct employment to 529,000 people. The firms also generate indirect employment for around 1.8 million people.
Chemical industry in the United States is one of the top exporting sectors. Apart from Germany, the United States is the world’s largest exporter of chemical goods. U.S. chemical exports in the year 2019 were worth USD 196.5 billion, accounting for 18% of global chemical shipments. The country mainly exports its products to Mexico, China, and Canada. The U.S. demand for imports is also very high. These imports were worth USD 102 billion in 2019.
Chemical industry in the United States manufactures and distributes a large variety of products. This industry has enhanced the understanding of and provides solutions for the world’s major challenges. Basic or commodity chemicals constitute an important segment of the chemical sector.
Commodity chemicals refer to the products manufactured in abundance. These include organic and inorganic chemicals, dyes, pigments, and plastic resins. Basic chemicals are majorly sold within the chemical industry and to other industries before becoming products for the general consumer. Several companies use some of their chemical products as intermediates in their manufacturing processes. There are often chemical clusters that use the output of one as the input to another. These plants are connected via steam pipes to efficiently use the energy released. The presence of clusters also considerably reduces the logistics cost.
Chemical companies in the U.S
The chemical companies in the United States have a strong foothold in the global chemical market. Dow chemicals is the largest U.S. chemical company, with a revenue of USD 42.9 billion in 2019. Other leading U.S. chemical companies are LyondellBasell and DuPont.
In 2016, several leading global chemical companies announced mergers. The mergers effectively changed the dynamics of the global chemical industry. One of the most important mergers during that period was the Dow Chemical and DuPont merger. The merger was finalized in September 2017. The new conglomerate DowDuPont existed as a single entity until April 2019. It then separated into three companies: DuPont, Dow, and Corteva, an agrochemicals company.
The basic chemicals manufacturing industry in the U.S. is highly concentrated in Texas. Chemical product manufacturing contributed USD 55.5 billion to Texas’ gross domestic product in 2016. This is the largest amount contributed by any manufacturing subsector. In 2016, 67% of all U.S. petrochemical production jobs were in Texas. The chemical sector offers employment to nearly 35,376 people in Texas. The state exported chemical products worth USD 36.6 billion in 2016. The large value of exports made the chemical sector the state’s second-largest export market. The industries in chemical manufacturing have experienced increased profits, production, and employment in recent years.
LyondellBasell, headquartered in Houston, Texas is one the largest chemicals, plastics, and refining companies in the world. The company produces materials and products that provide advanced solutions to modern challenges. It is the world’s largest producer of polypropylene compounds and the largest licensor of polyolefin technologies. LyondellBasell leads the industry in producing basic chemicals including ethylene, propylene, oxides, methanol, acetic acid, etc. The chemicals produced find applications in various industries including the automotive, furniture, cosmetics, adhesives industries, etc. LyondellBasell is also one of the world’s leading producers of versatile plastic resin including low-density and high-density polyethylene. LyondellBasell exports its products to more than 100 countries.
The Dow Chemical Company is among the largest chemical manufacturers in the world. Dow manufactures chemicals, plastics, and agrochemicals. The company employs around 54,000 people worldwide. Dow is among the leading producers of polystyrene, polyurethane, polyethylene, etc. Dow also produces ethylene oxides, surfactants, and cellulose resins. Commodity chemicals production accounts for 12% of the company’s total sales. Major basic chemicals produced include ethylene glycol, caustic soda, chlorine, and oxides. These chemicals produced are used internally by Dow as raw materials and by various industries worldwide.
ExxonMobil headquartered in Texas is one of the world’s largest publicly traded energy providers and chemical manufacturers. It is one of the largest chemical companies by revenue. ExxonMobil Chemical is an important petrochemical company. Its principal products include basic aromatics, olefins, ethylene glycol, polyethylene, etc. ExxonMobil generated total revenue of USD 264,938 million in the year 2019.
Investments in the chemical sector
The total foreign direct investment in 2017 exceeded USD 700 billion. The chemical industry in the United States spends relevant amounts for research and development. More than USD 10 billion was spent on research and development in the chemical industry in 2019. The chemical industry accounts for a significant portion of patents in the United States.
The United States is a competitive base for chemical firms across the globe. Various factors including product quality, access to low-cost natural gas, and a robust regulatory system contribute to the growth of the chemical sector in the U.S.