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Recently, the American Chemistry Council (ACC), in its analysis of the prospects for the U.S. chemical industry, stated that unpredictable trade policies and uncertain end-demand have had a significant impact on this industry. ACC predicts that U.S. chemical production (excluding pharmaceuticals) will grow by only 0.3% this year, with a decline of 0.2% expected by 2026. ACC also expects the U.S. GDP to grow by 1.3% in 2025, well below the 2.7% growth forecast made at the beginning of this year. ACC’s forecast for the U.S. chemical industry’s performance throughout the year indicates that chemical production increased by 6% on a quarter-on-quarter basis in the first quarter of this year, with weakness expected to prevail for the rest of the year. ACC said, “The outlook for the next 6 months has deteriorated.” As uncertainty in trade policies casts a shadow over the prospects of many end-use markets for chemicals, demand for chemicals is also expected to decline. ” Chris Young, President and CEO of ACC, said that uncertainty in trade policy is undermining the confidence of ACC members. Chris Young said, “I understand that they want to see sustainable demand growth.” Some say that activity in certain segments might increase, but it’s hard to believe that growth will truly resume. ”Martha Moore, chief economist at ACC, said that although tariff pre-purchases are not evident in inventory data, it may still be too early for changes in these indicators to show up in the data. She said, “Some inventory-to-sales ratios are rising, but not by a significant amount.” ”Trade policy is the main factor contributing to the deterioration of prospects for the chemical industry since 2025, with policy uncertainty being widespread across the entire economy. According to the ACC, both consumer spending and business investment in the United States are expected to slow down this year. Consumer spending is expected to grow by 1.9% in 2025, compared to 2.8% in 2024; business investment is expected to grow by 1.7% in 2025, down from 4.0% last year. ACC data shows that global industrial production growth is also expected to decline this year, albeit by a small margin, from 1.7% in 2024 to 1.5%. Moor said that after the weakness in the manufacturing sector over the past few years, there were some signs of recovery at the end of last year and the beginning of this year; however, the situation has now changed, with policy uncertainty being the biggest factor. ACC stated in its mid-year report: “The widespread uncertainty surrounding trade policy and its potential impacts has slowed economic activity in the United States and abroad.” Due to the lack of clarity, many companies find it difficult to make decisions; as numerous firms adopt a ‘wait and see’ approach, orders, investments, and hiring are being postponed. ”However, uncertainty in trade policy is not the only factor suppressing demand. Rising interest rates, increasing costs of materials and labor, and tariffs have reduced the affordability in the housing and automotive end markets. Moor said that in these two areas, affordability has become a major issue. ACC predicts that both light vehicle sales and housing starts in the United States will decline year-on-year in 2025. However, there are also some end markets that are performing relatively well. ACC states that production in the semiconductor industry is expected to grow by 7.0% this year, driven primarily by demand for applications in artificial intelligence. In addition, computers, oil and gas, as well as pharmaceuticals are also expected to experience high growth. Chris Young said that at the ACC annual meeting held earlier this month, there were concerns regarding the short-term economic outlook. As a result, ACC has lowered its full-year growth forecasts for most chemical end markets, predicting that sales will decline in about half of these markets this year. ACC remains “cautiously optimistic” that the uncertainties surrounding trade policy will eventually be resolved. It is also believed that the United States has the opportunity to engage in appropriate trade with its largest trading partners and ensure access to raw materials that are not produced in the U.S. According to ACC data, U.S. chemical exports are expected to decline by 1.9% this year, while imports are expected to fall by 1.0%. The United States has long enjoyed a trade surplus in chemicals, and this trend is expected to continue.