Plans for Grassroot Chemical Industry Plant Construction Remain Strong in 2012

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Researched by Industrial Info Resources (Sugar Land, Texas)--The pace of grassroot plant construction for the Chemical Processing Industry (CPI) in the United States and Canada picked up sharply in 2011, with an estimated 40 new plants beginning operations during the year. This is an increase of more than 100% from 2010, when 19 new CPI plants began commercial operations. The increase in new plant startups last year is just one of the factors reinforcing the momentum gained in the CPI since the end of the recession in North America.

Industrial Info is tracking 49 grassroot CPI plants that plan to start up in 2012. The largest of these plants began operations during the first quarter of the year: Air Products & Chemicals (NYSE:APD) (Allentown, Pennsylvania) started up its $250 million hydrogen plant in Luling, Louisiana. The largest new plant expected to begin operations during the second quarter is NA Industries Incorporated's (Chattanooga, Tennessee) estimated $100 million super-absorbent polymers (SAP) plant in Pasadena, Texas, which is expected to begin operating in June.

The second quarter will be the period in which the greatest number of new plant startups is expected, as 20 new plants are expected to begin operating. New plant startups slow significantly during the summer months to seven new plants, and then jump back to 15 new plants in the fourth quarter.

Across the country, the Southwest market region, which includes Texas, Louisiana, Arkansas and Oklahoma, stands to gain the most from grassroot construction this year, with 15 plants planned to start up that will employ approximately 625 people. The Mid-Atlantic market region follows, with eight new plants and an impressive employment count of nearly 500 people.

For many decades, industry observers looked at grassroot plant construction starts and completions as a factor used to measure the health of an industry. Considering the very mature state of the CPI in the United States and Canada over the past two decades, this hasn't been one of the best or most widely watched indicators for many years. The sharp increase in new CPI plant startup activity over the past two years has once again restored optimism that the industry still has room for grassroot growth, even in the face of global competition. There's little doubt that access to some of the world's cheapest natural gas resources and the very complex network of connected infrastructure is fueling the advantages promoting this growth.

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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.