The US chemicals industry includes about 10,000 companies with combined annual revenue of about $500 billion. Major companies include Dow and DuPont. The industry as a whole is fragmented, but concentration in many segments is very high: just a handful of manufacturers generate 80 percent or more of segment revenue.
COMPETITIVE LANDSCAPE
Demand is driven by the health of the US economy because chemicals are used to make a wide variety of industrial and consumer products. The profitability of individual companies is closely tied to efficient operations. Big companies have large economies of scale in production. Small companies can compete effectively by producing specialty products, of which there are a large number, or by operating a single plant highly efficiently. The industry is capital-intensive: average annual revenue per employee is more than $500,000.
PRODUCTS, OPERATIONS & TECHNOLOGY
Basic chemicals include petrochemicals, industrial gases, dyes and pigments, alkalies and chlorine, alcohols, and various other organic (based on the chemistry of carbon and oxygen) and inorganic chemicals. These basic chemicals are made from mined materials like crude oil, natural gas, and minerals, or from crops and other natural substances. The raw materials are called feedstocks. Chemicals companies use basic chemicals to produce intermediate products like polyethylene; polyethylene oxide (PO); ethylene oxide (EO); and ethylene glycol, or final products like phosphate and nitrogen agricultural fertilizers.
Basic and intermediate chemicals are collectively referred to as commodity chemicals. Commodity chemicals are ...
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