Capital, Maintenance Project Spending to Dip in 2013, but Ethanol Rebound on Horizon

---

Researched by Industrial Info Resources (Sugar Land, Texas)--When measuring the 2013 project pipeline using data extracted from Industrial Info's capital and maintenance project database, spending is expected to be down about 9% and project activity is expected to be down about 2%.

Consumer spending is expected to improve a modest 3%, and natural gas and crude oil prices are expected to maintain $2.5 per 4.5 million British thermal units (BTU) and oil above $80 barrels.

A noticeable correction in the economy is not expected until mid-2013, more likely 2014 or even further out. Overall capital and maintenance spending in the industrial markets is expected to increase only 0.16% from 2012 levels and is forecast to be about $263 billion.

One industry, biofuels, is starting off the New Year with an estimated 36 fuel ethanol plants and more than 500 million gallons of capacity sitting idle.

Ethanol output continues to slump on high-priced corn, poor demand and high costs, which are accelerating plant closures and curbing operational plant output. With demand for gasoline down, ethanol producers are finding themselves sitting on stockpiles. Inventory levels increased 2.3% to 20.54 million barrels at the end of January.

The U.S. Energy Information Administration said it expects ethanol to rebound in 2014. The agency said that previously idled capacity is expected to be brought back online in 2014 to help meet the renewable fuel standard mandate. Overall, ethanol production is expected to average 915,000 barrels per day, or 14 billion gallons per year, in 2014.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, 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.