Released January 26, 2021 | SUGAR LAND
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Researched by Industrial Info Resources (Sugar Land, Texas)--Putting it extremely mildly, last year's North American project spending was a disappointment. Industrial Info's North American Industrial Project Spending Index, which measures the value of all active projects in the pipeline for the year on a monthly basis, showed year-over-year spending drops for 11 of the 12 months of 2020. Only January 2020 registered in positive territory, with a 1% increase.
Still, hope springs eternal, even in this time of pandemic-induced economic malaise, and a number of economic indicators are pointing to improved conditions for project activity going forward.
Click on the image at right for a graph showing North American industrial spending since December 2019.
For December, the index totaled $245.3 billion, down 25.86% from $330.84 billion reported in December 2019.
Year-over-year project spending increases for December were reported in only three of the 12 industries followed by Industrial Info: Petroleum Refining, up 3.55% at $10.67 billion; Metals & Minerals, up 20.97% at $16.65 billion, and Food & Beverage, up 13.37% at 2.18 billion.
Click on the image at right for a graph detailing the December spending index.
In the petroleum refining arena, the American Petroleum Institute (API) reported that refinery throughput in December rose along with refining margins, reaching 14.6 million barrels per day (BBL/d), and 79.3% capacity utilization.
Industrial Info has identified $15.5 billion worth of petroleum refining project activity in the U.S. and Canada that is proposed to start construction this year through 2022. Refiners took a drubbing in 2020, as a result of the COVID-19-driven drop in demand, but in-plant capital projects and unit additions have a good chance of moving forward, said Chris Paschall, Industrial Info's vice president for refining and crude research, during last week's 2021 North American Industrial Market Outlook event. For more information, see January 25, 2021, article -- 2021 North American Industrial Market Outlook: $15.5 Billion of Potential Refinery Kickoffs Tracked in U.S., Canada.
The API also reported U.S. petroleum demand slowed in December, with relatively weak seasonal demand, but productivity gains sustained U.S. crude oil production of 11 million BBL/d while natural gas liquids held steady at 4.9 million BBL/d.
The U.S. also saw record-high refining and petrochemical demand for naphtha and gasoil of 5.9 million BBL/d. The numbers reflected increased needs during the COVID-19 pandemic for packaging, single-use plastics and propylene-based products, the API said.
The Institute of Supply Management's (ISM) Purchasing Managers Index (PMI), which follows 18 industry sectors in the U.S, indicated the overall economy grew for the eighth consecutive month in December, as the manufacturing economy continued its recovery.
According to the U.S. Federal Reserve Board's latest Beige Book on economic conditions, released January 13, most Federal Reserve districts reported that economic activity increased modestly since the previous Beige Book period that was reported in October, although conditions varied among the districts.
"Auto sales weakened somewhat since the previous report, while activity in the energy sector was said to have expanded for the first time since the onset of the pandemic. Manufacturing activity continued to recover in almost all districts, despite increasing reports of supply chain challenges," according to the Beige Book.
Project spending by the Industrial Manufacturing Industry remained relatively strong last year and is expected to grow during the next two years, said David Pickering, Industrial Info's vice president of research for the industry, during last week's North American Industrial Market Outlook. For more information, see January 26, 2021, article - North American Industrial Manufacturing Outlook: Fairly Robust 2020 Spending to Increase in 2021-22.
The North American Spending Gap Index, which measures the amount of fallout from projects that have been canceled, placed on hold or moved to another year, widened 28.35% to $468.2 billion in December from $364.7 billion a year earlier. The spending gap grew in all but two of the 12 industries tracked by Industrial Info.
Click on the image at right for the December Spending Gap Index.
Also, Industrial Info's North American Construction Starts Index, which measures the amount of project activity that has been funded and started construction for the year, amounted to $233.94 billion in December, down 30.2% from December 2019. Total investment values fell in all but two industries.
Click on the image at right for the December Construction Starts Index.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
Still, hope springs eternal, even in this time of pandemic-induced economic malaise, and a number of economic indicators are pointing to improved conditions for project activity going forward.
For December, the index totaled $245.3 billion, down 25.86% from $330.84 billion reported in December 2019.
Year-over-year project spending increases for December were reported in only three of the 12 industries followed by Industrial Info: Petroleum Refining, up 3.55% at $10.67 billion; Metals & Minerals, up 20.97% at $16.65 billion, and Food & Beverage, up 13.37% at 2.18 billion.
In the petroleum refining arena, the American Petroleum Institute (API) reported that refinery throughput in December rose along with refining margins, reaching 14.6 million barrels per day (BBL/d), and 79.3% capacity utilization.
Industrial Info has identified $15.5 billion worth of petroleum refining project activity in the U.S. and Canada that is proposed to start construction this year through 2022. Refiners took a drubbing in 2020, as a result of the COVID-19-driven drop in demand, but in-plant capital projects and unit additions have a good chance of moving forward, said Chris Paschall, Industrial Info's vice president for refining and crude research, during last week's 2021 North American Industrial Market Outlook event. For more information, see January 25, 2021, article -- 2021 North American Industrial Market Outlook: $15.5 Billion of Potential Refinery Kickoffs Tracked in U.S., Canada.
The API also reported U.S. petroleum demand slowed in December, with relatively weak seasonal demand, but productivity gains sustained U.S. crude oil production of 11 million BBL/d while natural gas liquids held steady at 4.9 million BBL/d.
The U.S. also saw record-high refining and petrochemical demand for naphtha and gasoil of 5.9 million BBL/d. The numbers reflected increased needs during the COVID-19 pandemic for packaging, single-use plastics and propylene-based products, the API said.
The Institute of Supply Management's (ISM) Purchasing Managers Index (PMI), which follows 18 industry sectors in the U.S, indicated the overall economy grew for the eighth consecutive month in December, as the manufacturing economy continued its recovery.
According to the U.S. Federal Reserve Board's latest Beige Book on economic conditions, released January 13, most Federal Reserve districts reported that economic activity increased modestly since the previous Beige Book period that was reported in October, although conditions varied among the districts.
"Auto sales weakened somewhat since the previous report, while activity in the energy sector was said to have expanded for the first time since the onset of the pandemic. Manufacturing activity continued to recover in almost all districts, despite increasing reports of supply chain challenges," according to the Beige Book.
Project spending by the Industrial Manufacturing Industry remained relatively strong last year and is expected to grow during the next two years, said David Pickering, Industrial Info's vice president of research for the industry, during last week's North American Industrial Market Outlook. For more information, see January 26, 2021, article - North American Industrial Manufacturing Outlook: Fairly Robust 2020 Spending to Increase in 2021-22.
The North American Spending Gap Index, which measures the amount of fallout from projects that have been canceled, placed on hold or moved to another year, widened 28.35% to $468.2 billion in December from $364.7 billion a year earlier. The spending gap grew in all but two of the 12 industries tracked by Industrial Info.
Also, Industrial Info's North American Construction Starts Index, which measures the amount of project activity that has been funded and started construction for the year, amounted to $233.94 billion in December, down 30.2% from December 2019. Total investment values fell in all but two industries.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com.
