The Chemical Industry

Economic factors deliver formula for success.

Despite a slowing global economy, the chemical industry is showing positive signs of growth this year.

According to the American Chemistry Council, the US Chemical Production Regional Index (CPRI) was up 2.3 percent. Some of the segments contributing to this growth have a prominent presence in New Jersey, which include pharmaceuticals, consumer products, basic chemicals, plastic resins and specialty chemicals.

The slightly weaker dollar is helping to make the price of our products more competitive globally, and the access to an abundant source of low price natural gas is making the US attractive again for investment to manufacture these products.

Natural gas development, particularly the horizontal hydraulic fracturing process, is creating a value stream for the manufacturing sector that has not been seen in many years.

The US chemical industry has made more than $164 billion in new investments because of the access to plentiful and cheap natural gas. While there is no hydraulic fracturing taking place in New Jersey, our close proximity to the Marcellus Shale will enable New Jerseyans to receive several benefits, namely: cheaper energy; cleaner energy; nearby high-paying jobs; cheaper products; and cheaper feedstocks for the chemical industry.

Access to some of the best research scientists, chemical engineers and a skilled workforce in chemical manufacturing makes New Jersey an ideal location for any chemistry company to build and grow. New Jersey remains uniquely positioned.

In fact, the total number of people employed by chemistry manufacturing companies increased by 2.3 percent compared to a year ago, according to March numbers released by the New Jersey Department of Labor & Workforce Development.

New Jersey continues to be the North American headquarters of some major companies, including Solvay, Church & Dwight and BASF, to name a few. Chemistry companies, small and large, continue to call New Jersey home, such as International Flavors & Fragrances, Cardolite, Croda USA and Honeywell International. They are all part of New Jersey’s $25.3-billion chemistry industry, making it the largest manufacturing industry in the state. Chemistry exports from New Jersey increased by 11 percent in 2015, accounting for 26 percent of the value of all New Jersey exports, or $8.3 billion, making its products the state’s largest export.

New Jersey is also the leading state for the development and manufacturing of flavors and fragrances, a unique sector of the business of chemistry. Currently, 38 fragrance companies are located in New Jersey, many of which are headquartered in the state. More than 85 percent of global fragrance companies operate in New Jersey. There is a renewed interest and commitment by the state and research institutions to grow the flavors and fragrance sector.

Despite the new opportunities and general good economic health of the more than 60 chemistry manufacturers represented by the Chemistry Council of New Jersey, the industry still faces significant challenges.

Our companies need to be able to adapt so they can remain resilient in the world economy. State policies must not hinder that process. New policies should help the citizens of New Jersey thrive, protect the environment, and build the state’s economic base, but they should not unfairly target regulated companies by imposing redundant regulations that do nothing to help the state thrive, protect the environment, or improve the economy, but do everything to drive more business out of the state.

New Jersey’s chemistry industry is driving innovations that make our lives and our world healthier, safer, more sustainable and more productive. In New Jersey, the industry continues to increase efficiency and productivity, while reducing its environmental impact. The chemistry industry’s Toxic Release Inventory emissions, monitored by the EPA, have been reduced by 94 percent in New Jersey since 1988.

If New Jersey continues to promote confidence in the regulatory landscape, help reduce electricity costs, and incorporate a fair tax and fee structure, the potential to attract future investments in its largest manufacturing sector is great. Renewed investment in US chemistry manufacturing and historically low natural gas costs are creating a unique environment for growth – and New Jersey is in a unique position to benefit from this growth.


Chemistry Council of New Jersey

Shawn Blythe

Capitol View Building
150 W. State Street
Trenton, NJ 08608



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