2019 has seen the impact of trade tension, weaker economic growth and a decade of impressive capacity growth have combined in short order to weigh on the global chemistry sector. These factors have combined to weaken chemical product demand growth and weigh on current prices as the market adjusts to the new economic backdrop. Despite dour headline numbers in this year’s Q3 report, it is important to note that on an overall volume and pricing basis the Canadian Industrial Chemical sector is still relatively healthy. Export volumes remain near cyclical highs in most products and while prices have retreated to levels seen in late 2017 they remain strong by recent historical standards.
Shipments of Industrial Chemicals declined 3.6% on a dollar basis in the first nine months of 2019 compared to the same time period in 2018. The decline was led by a 11.8% drop in Petrochemical shipments. Industrial Gas shipments increased by 16% and Inorganic and Organic Chemical shipments saw small increases while Resin shipments showed no growth.
Exports for Industrial Chemicals declined by 6.4% in the first nine months of 2019, with every sub-sector registering a decline, led by a 10% drop in Petrochemical shipments.
Industrial Chemical GDP declined by 4.2% in the 3rd quarter of 2019 compared to the 2nd quarter of the year.
Railcar shipments of Industrial Chemicals were flat from Q2 to Q3 2019.