Balanced against imports of nearly $73.6 billion, 2000’s $6.3-billion trade surplus continues a more than 70-year uninterrupted history of trade surpluses for the United States. The trade surplus for the US chemistry industry totals $153 billion over the past decade.
The North American Free Trade Agreement (NAFTA) has contributed to strong gains in US exports to Mexico, up 23% to $8.6 billion. Robust markets for US exports in 2000 included Venezuela, Ireland, the United Kingdom, Russia, South Africa, Indonesia, the Philippines, and South Korea. Modest export gains were experienced in many large Western European and East Asian nations, as well as in the Middle East.
The year also saw a high level of imports. Gains in fine chemicals and other products from Ireland boosted imports from that nation by 81% to $11.6 billion in 2000. Ireland is the second-largest source of imports to the United States, trailing Canada by less than $25 million. Solid import gains from Brazil, Venezuela, Russia, and the rest of central/eastern Europe, South Africa, Saudi Arabia, India, Indonesia, Malaysia, Taiwan, and Thailand also were experienced. More modest gains from a number of other western European and Asian nations also were recorded. Overall, imports increased 18.4%, reaching $73.6 billion in 2000.
The strong US dollar and economy contributed to an import surge and a trade surplus in chemicals that fell from $8.3 billion in 1999 to $6.3 billion in 2000. This is a pronounced decline from the record surplus of $20.4 billion in 1995. Most of this decline can be traced to rising imports from Western Europe alone. The trade deficit with central/eastern Europe and the Middle East also deteriorated during 2000. Offsetting this somewhat were improvements in the trade surpluses with Canada and Mexico, Latin America, and other Asia/Pacific nations.
The trade deficit in electronic, fine, and other specialty chemicals rose from $2.0 billion to $5.7 billion. A trade deficit in inorganic chemicals reached $945 million. A surge in pharmaceutical exports reduced the pharmaceutical deficit to $1.8 billion in 2000. A $950-million trade surplus in crop protection chemicals helped reduce the overall life sciences deficit to $840 million. With solid gains in exports, the overall balance in basic chemicals rose from $10.6 billion to $11.6 billion in 2000. Improvements occurred in bulk petrochemicals and intermediates, plastic resin, and other industrial chemical trade surpluses.
The decline in the value of the dollar vis-a-vis the euro will have a positive effect on export performance. With higher energy prices limiting growth in overseas economies, however, the global economy is not maintaining the momentum of 2000. As a result, the picture for 2001 trade is mixed. The American Chemistry Council expects exports to increase 6.3% in 2001, a lower pace than what was anticipated several months ago. In addition, imbalances in natural gas supply and demand have resulted in feedstock costs that have placed much of Gulf Coast-based petrochemical production in a less competitive situation vis-a-vis other major producing regions. As a result of this less competitive situation, this segment’s exports ($35.5 billion in 2000) will deteriorate during 2001. This is particularly the case with plastic resins and other derivative exports to Asia.