Chemical Industry News – March

Chemical Industry News - March 2014 - The Chemical Company

The American Chemistry Council (ACC) US Chemical Production Index rose by 0.3% in January, following a revised 0.6% gain in December, 2013. Production increased in all seven regions of the US for the third consecutive month. Compared to January 2013, total chemical production in all regions increased by 0.3% year-over-year.

The ACC reported that US exports of chemicals grew 0.4% in 2013, while chemical imports declined by 1.0%, expanding the chemical industry trade surplus to $3.4 billion. The US chemical industry typically has a surplus in all its major segments with the exception of pharmaceuticals and agricultural chemicals.

The ACC’s Chemical Activity Barometer (CAB) rose by 0.2% in January. The CAB has shown a gain for nine consecutive months and it is up 2.6% over a year earlier.

Draft legislation for overhaul of the Toxic Substances Control Act was proposed in the House of Representatives on February 27. Among other points, it would require the EPA to divide all commercial chemicals on the market into two categories: low or high priority, depending on risk to human health or the environment. Chemical industry trade associations have welcomed the draft, while environmental activists are speaking out against it. With increased bipartisan support there could be a vote before elections this fall.

The EPA issued on March 3 long-awaited rules to reduce sulfur content of gasoline by 67% in 2017. The American Petroleum Institute and the American Fuel and Petrochemical Manufacturers said that the rules would raise gas prices by 10 cents per gallon and incur billions of dollars in capital costs. EPA administrator Gina McCarthy disagreed and said that the increase would be less than one cent per gallon.

A new experiment by scientists at the US Food and Drug Administration has found that bisphenol A (BPA) doesn’t affect the health of rats fed low doses. European studies have indicated that BPA poses no risk to infants. Some scientists have said that the FDA study is flawed and the controversy continues.

The Canadian government is lending $10 million to a Quebec firm for the construction of a commercial scale bio-based chemical plant, the first of its kind in Canada. A succinic acid plant will be built in Sarnia, Ont. and will have a capacity of 30,000MT/year.

Dow Chemical turned down a request that the company spin off its petrochemical businesses. This was in response to Daniel Loeb, CEO of Third Point, whose company has taken a $1.3 billion stake in Dow.

BASF reported an increase of 16% in net income for Q4 2013 year on year to €1.14 billion.

US chlor-alkali average operating rates increased to 86% in January 2014 from December’s 84%. New production from Westlake’s Geismar, LA plant was to come on line in March, adding 350,000 electrochemical units (ECU), representing 350,000 MT of chlorine and 385,000 MT of caustic soda of annual production. Dow Chemical and partner Mitsui are preparing for start-up of an 800,000 ECU/year facility in Freeport, Texas which will replace older, existing equipment.

The US Geological Survey reported that US production of soda ash in 2013 was a record high at 11.4 million tons.

The House of Representatives passed legislation on March 4 that aims to boost energy efficiency of commercial buildings.

Supreme Court Justice Anthony Kennedy recently suggested that he believed that the EPA overstepped its bounds in the way that it requires greenhouse gases be regulated under permits for power plants.

Senator Manchin, D-WV and Rep. Whitfield, R-KY are seeking to pass a measure that would eliminate the carbon capture requirement for new coal-fired power plants and delay the EPA carbon emission rules for existing plants. The House passed such legislation on March 6, but it’s not likely to come up for a Senate vote. The administration is against the bill, and it risks a presidential veto.

Electric car maker Tesla Motors says that is considering sites in Nevada, Arizona, New Mexico, and Texas for a massive battery factory that would employ approximately 6,500 people. The company has not specified locations, but plans to start construction this year with completion in 2017. Cost is estimated at between $4 and $5 billion.

According to Russia Business Directory, the chemical industry accounts for 10.4% of the total output of Russian processing industry and 5.4% of export profits. The industry employs more than 740,000 people. It was stated the Russian chemical industry accounts for 1.1% of world output, but has 15% of world ammonia and carbamide(urea) production.

Brazil’s chemicals trade deficit increased by 13.6% in 2013, reaching a total of $32 billion. Brazil imported $46.1 billion in chemical products last year, an increase of 7.3% year on year.

Mitsui Chemicals is closing multiple plants in Japan and bringing in a new CEO. It is one of Japan’s largest chemical companies with sales of $17.6 billion in its last fiscal year. But it has not shown a profit in three of the past four years.

China’s economy grew by a healthy 7.7% in 2013, and is expected to grow at a rate of 7.4% in 2014. The national target is 7.5%.

China’s producer price index in January was 1.6% lower year to year and was viewed by some as a sign of continued slowness in the manufacturing sector.

China’s consumer price index increased at an annual rate of 2.5% in January at no change from December.

China’s February exports dropped 18.1% from a year earlier. Imports increased 10.1%, resulting in a trade deficit of $23 billion.

According to a revised German government forecast, the country’s economy should expand by 1.75% this year and 2.0% in 2015.

Germany’s business climate continued to grow in February. Munich-based Ifo, an economic research group, reported that its monthly business climate index for Germany (2005 = 100) rose to 111.3 from 110.6 in January from 109.5 in December. The survey represents responses from firms in construction, manufacturing, wholesaling and retailing.

Unemployment across the seventeen European Union countries that use the euro was reported unchanged at 12.0% for January, stable since October 2013. The lowest rates among member states were Austria at 4.9%, Germany at 5.0% and Luxembourg at 6.1%. The highest rates among member states were Greece at 28.0% and Spain at 25.8%.

February inflation in the Euro zone was reported at 0.8%, unchanged from January and December and down from 0.9% in November. At numbers less than 1%, this is considered by the European Central Bank as the “danger zone.”

BNSF Railway Co. intends to buy its own fleet of up to 5,000 new crude oil tank cars with safety features that exceed the latest standards adopted by the industry more than two years ago. The railroad is owned by Berkshire Hathaway and is a major mover of crude oil by rail throughout the US. Railcars are usually owned by companies that lease them to shippers.

Total carload rail volume for February decreased 0.4% overall compared with February 2013.  Intermodal volume was up 1.1% compared to the same period in 2013 and was the 51st consecutive year over year monthly increase for intermodal volume.

The American Trucking Association reported that seasonally adjusted for-hire truck tonnage decreased 4.3% in January after a decline of 0.8% in December. The index was 1.2% higher year to year.

Shale Oil and Gas Related

World Shale Oil&Gas Latin America Summit

BASF has ruled out the possibility of importing shale gas from the US for use in its European petrochemical operations.

The American Petroleum Institute has urged the federal government to increase liquefied natural gas (LNG) exports amid the continuing crisis in Ukraine. Chevron Corp. Chairman John Watson said that there are more than enough reserves in North America to expand exports. A special permit is required from the US government to send LNG to countries that don’t have a free trade agreement with Washington.

According to the American Chemistry Council, potential US chemical industry investment linked to plentiful and affordable natural gas from shale formations has topped $100 billion.

The International Energy Agency (IEA) stated that oil demand in 2014 would be greater than last year based on stronger economic growth. Global production of crude oil is expected to increase in 2014 and 2015, with the US leading the way. At the same time, OPEC output is expected to decrease.

The southern leg of the Keystone XL oil pipeline, known as the Gulf Coast Project, is expected to begin deliveries. This section runs from Cushing, Oklahoma to the US Gulf Coast, and does not require White House approval, unlike the northern Keystone XL which crosses the Canadian-US border.

A new Washington Post-ABC News poll shows that Americans support the idea of constructing the Keystone XL oil pipeline between Canada and the US by a nearly three to one margin, with 65% saying that it should be approved. The poll also indicated that the public thinks that the project will create a significant number of jobs.

Canadian Natural Resources Ltd. will pay $3.125 billion in cash in order to buy conventional oil and gas assets in Western Canada.

Canadian oil exports to the US increased 10% in 2013, averaging more than 2.5 million barrels per day.

The chief executive of the International Energy Agency, Maria van den Hoeven, said in an interview with The Christian Science Monitor that US oil and natural gas production will plateau, and then go down from 2025 onward.

The Economy

Wall Street

The Congressional Budget Office estimated that the federal government incurred a budget deficit of $184 billion for the first four months of fiscal year 2014, $107 billion less than the shortfall reported for the same period a year ago. If lawmakers pass no additional legislation affecting spending/revenues, the federal government will end fiscal year 2014 with a deficit of $514 billion compared with a $680 billion deficit in fiscal year 2013. The US Treasury Department reported that on March 5, 2014 the federal debt was $17.448 trillion. The US population is approximately 317 million, so each citizen’s share of the debt is roughly $55,000. The national debt has increased an average of $2.65 billion per day since September 30, 2012.

The $3.9 trillion federal budget released on March 4 would, according to some analysts, exceed the ceiling agreed to in December of last year with $56 billion in new stimulus spending.

The CBO recently concluded that the Affordable Care Act would result in the net loss of the equivalent of 2.5 million full time workers. This was followed by a CBO report stating that the higher minimum wage proposed by the administration would cost the economy as many as one million jobs.

The IMF modified its growth forecast for the world economy to 3.7% in 2014 and 3.9% in 2015, based on anticipated growth in advanced economies.

Personal income in January increased $43.9 billion or 0.3% according to the Bureau of Economic Analysis. In December, personal income decreased less than 0.1 % or $5.5 billion.

The Bureau of Economic Analysis second estimate showed an increase in Gross Domestic Product of 2.4% in the fourth quarter of 2013, that is, from the third quarter to the fourth quarter. This was revised from an earlier figure of 3.2%. It was noted that all the growth came from private spending and investment. In the third quarter real GDP increased 4.1%, in the second quarter, real GDP increased 2.5% and first quarter data showed an increase of 1.1%.

Current-dollar GDP, the market value of the nation’s output of goods and services, increased 4.0% or $167.8 billion in the fourth quarter to a level of $17,080.7 billion. In the third quarter current dollar GDP increased 6.2% or $251.9 billion to a level of $16,912.9 billion.

The Conference Board’s Leading Economic Index increased 0.3% in January to 99.5 (2004 = 100) following no change in December, and a 0.9% increase in November.

The Conference Board Consumer Confidence Index which had increased in January fell in February. The index now stands at 78.1 (1985 = 100), down from 79.4 in January.80.7 (1985 = 100) up from 77.5 in December.

The Institute for Supply Management’s February Manufacturing Index registered 53.2%, an increase of 1.9% from January’s reading of 51.3%, which was a decrease of 5.2% from December’s seasonally adjusted reading of 56.5%. The Non-Manufacturing Report for February was 54.6%,  a decrease of 1.7% from January’s 56.3%, but reflecting growth at a slower rate.

In January, retail and food services sales adjusted for seasonal variations were $427.8 billion, a decrease of 0.4% from December but 2.6% above January 2013. Total sales for the twelve months ending January 2014 were up 3.4% from a year earlier.

Privately owned housing units authorized by building permits in January were at a seasonally adjusted annual rate of 937,000, which was 5.4% below the revised December rate 991,000, but is 2.4% above the January 2013 figure of 915,000. Single family authorizations in January were at a rate of 602,000, which was 1.3% below the revised December figure of 610,000.

Sales of new single family houses in January were at a seasonally adjusted rate of 468,000. This was 9.6% above the revised December rate of 427,000 and is 2.2% higher than the January 2013 number of 458,000.

The National Association of Realtors reported that total sales of existing homes fell 5.1% in January to a seasonally adjusted annual rate of 4.62 million from a December rate of 4.87 million and were also 5.1% below the January 2013 rate of 4.87 million. The national median existing home price for January was up 10.7% from January 2013. Distressed homes, foreclosures and short sales, accounted for 15% of January sales, compared with 14% in December and 24% in January 2013.

New orders for manufactured durable goods in January decreased $2.2 billion or 1.0% to $225.0 billion. This decrease, down three of the last four months, followed a December decrease of 5.3%.

January unfilled orders for manufactured durable goods increased $0.6 billion or 0.1% to $1061.1 billion. This number has increased for eleven of the last twelve months.

Consumer Price Index for all urban consumers increased 0.1% in January on a seasonally adjusted basis. The US Bureau of Labor Statistics reported that over the last twelve months the all items index increased 1.6% before seasonal adjustments. Food index rose 0.1% and has not posted a monthly increase larger than 0.1% since June 2013.  The electricity index posted its largest increase since March, 2010; gas and fuel oil rose as well whereas the gasoline index decreased.

The seasonally adjusted Producer Price Index for finished goods increased 0.2% in January, following a 0.1% increase in December and no change in November. On an unadjusted basis, prices for finished goods increased 1.2% for the twelve months ended in January 2014.

Interest rate: Prime at 3.25%, unchanged since 12/16/08.

Inflation: Inflation rate for the twelve months ended in January 2014 reported at 1.6%; December was reported at 1.5%, November at 1.3%. A rate of 1.8% for 2014 is foreseen by some economists. An average rate of 2.1% was reported for 2012.

Industrial production decreased 0.3% in January, after having risen 0.3% in December, which was a fifth consecutive monthly increase. For the fourth quarter of 2013, it increased at an annual rate of 6.8%. Total industrial production in January was 2.9% above the rate of a year earlier. Capacity utilization rate for total industry decreased 1.6% to 78.5%, a rate 1.6 % below its 1972 – 2013 average.

Unemployment: The February unemployment rate was little changed at 6.7% from the January rate of 6.6% as reported by the Bureau of Labor Statistics. The number of unemployed persons was reported at 10.5 million. The long-term unemployed, i.e., jobless for 27 weeks and over was reported at 3.8 million in February, an increase of 203,000. Those individuals accounted for 37% of the unemployed. The number of long-term unemployed has declined by 901,000 in the past twelve months. In December, North Dakota continued to lead the nation with the lowest state unemployment rate of 2.7%; Rhode Island and Nevada were highest at 9.3% and 9.0% respectively.

The US Census Bureau and the Bureau of Economic Analysis through the Department of Commerce announced on March 7 that total January exports of $192.5 billion and imports of $231.6 billion resulted in a goods and services deficit of $39.1 billion, up from the revised December figure of $39.0 billion.

Crude Oil: WTI trading at ~$103/bbl, an increase of ~ $10 from a year earlier.

Extremely cold weather continued to drive up natural gas pricing through February and into early March. Henry Hub spot price rose to $7.90/MMBTU on March 4, and then settled back down to $6.41/MMBTU.  April contracts were trading at $4.52. Working natural gas in storage at the end of February decreased and was 43.2 % lower than last year at that time, and 38.8% lower than the five year average.

The US dollar trading at 102.4 Japanese yen; $Canadian 1.10; $1.37 = euro; The British pound sterling = $1.67.

Current US gold price quoted at $1338.00/ounce. The record price of $1920/ounce was recorded in September, 2011.

Chemical Industry News – July

Chemical Industry News July 2013

The American Chemistry Council (ACC) US Chemical Production Index increased by 0.1% in May 2013 following a downwardly revised 0.2% decline in April. Compared to May 2012, chemical production rose in all regions by 0.9% following April’s 0.5% year to year increase. Comparing the first five months of 2013 to those of 2012, total chemical production rose 0.7% nationally.

The ACC’s Chemical Activity Barometer (CAB) rose by 0.3% in June, following a revised 0.1% increase in May. The year over year monthly moving average showed an increase of 3.5% over a year ago.

The TSCA reform bill is supported by the ACC and other groups, including the Environmental Defense Fund.
Senator Debbie Stabenow, D-MI, has introduced the Qualifying Renewable Chemical Production Tax Credit Act of 2013, which would cut taxes for American renewable chemicals producers.

The ACC filed a lawsuit in federal district court challenging new EPA requirements for antimicrobial pesticides, which are used to disinfect or sanitize and as ingredients in coatings and paints.

An EPA proposal aimed at requiring energy and chemical companies to disclose emissions-calculating methods has drawn criticism from the chemical industry, as it could expose trade secrets.

The Obama administration will not penalize businesses that do not provide health insurance in 2014, the Treasury Department announced on July 2. It will delay enforcement of a requirement of the Affordable Care Act for a year.

President Obama revealed on July 2 a package of separate actions focused on curbing US greenhouse gas (GHG) emissions, with an apparent focus on coal-fired electrical generation. His plan also covers home appliance efficiency standards, fuel mileage rules for over the road trucks, and new subsidies for wind farms. As recently as 2008, coal accounted for more than 50% of US electric generation but dropped to 37% in 2012. He also declared that he will approve the Keystone XL pipeline “only if this project does not significantly exacerbate the problem of carbon pollution.” It’s anticipated that if the project isn’t approved, the Alberta oil will end up in China.

Evonik announced on June 20 that it is introducing a new generation of PVC plasticizers with the product name of ELATURE. Production is at the company’s facility in Marl, Germany.

The European Chemicals Agency reported that 6,600 materials were registered under the first two phases of the REACH chemicals registration program. The next target date of May, 2018 will require registration of chemicals supplied in volumes of one to one hundred MTs per year. There is speculation in the industry that smaller or less profitable businesses may cease operations as a result.

Netherlands-based DSM plans to license its cellulosic ethanol technology after its first commercial plant in Iowa is completed. The plant is projected to make 20 to 25 million gallons of fuel per year from corn waste (husks, crop waste); production is expected to start early in 2014.

NOVA Chemicals is building a one billion pound per year linear low density polyethylene plant in Joffre, Alberta Canada in order to take advantage of low cost natural gas feed stock. The feedstock will be from the Bakken shale in North Dakota as well as off-gas from oil sands production in Alberta.

Linde will invest €70 million as well as manage the gas supply infrastructure for SIBUR, the Russian petrochemical company.

A bill banning the sale of polystyrene food service products proposed by New York City Mayor Bloomberg has been opposed by food industry representatives. Polystyrene foam takes hundreds of years to break down and NYC recyclers have difficulty in separating it at extra costs.

US chlor-alkali operating rate for May 2013 was reported stable at 87% of capacity. European operating rates were below 2012 level due in part to severe flooding in parts of Central Europe.

The US District Court for the District of Columbia recently struck down a rule implemented as part of the Dodd-Frank financial reform law requiring publicly traded extractive industry companies to report taxes, royalties, and other fees paid to foreign governments. The decision was hailed by industry groups that stated that such disclosure would hurt companies’ ability to compete.

Solvay will be closing its Portuguese soda ash facility by January, 2014. At the same time, the company is planning to expand capacity at its Green River, Wyoming operation.

Shintech (Japan) plans investing $500 million in further expansion of its Louisiana operation. Planned capacity increases are expected to be about 200,000 MT/year of caustic soda, 300,000 MT/year of vinyl chloride monomer (VCM) and 300,000 MT/year of polyvinyl chloride (PVC). Target completion date is 2015.

Chinese industrial output slowed in June, and employment figures also dropped at the fastest rate since the Asian financial crisis of 1998. The World Bank cut its growth forecast for China, saying that it would likely grow 7.7% compared to an earlier figure of 8.4%.

Petrobras, the state-owned Brazilian energy enterprise, has signed a letter of intent with Chinese petrochemical company Sinopec to study a possible joint venture to build and operate a planned refinery in Maranhao state, Brazil. The refinery would have a total capacity of 300,000 bbls per day.

The Chinese government has decentralized decision making regarding 177 refinery and petrochemical projects. For certain projects, approval from Beijing will not be required and authority will shift to local governments.

The Organization for European Cooperation and Development’s (OECD) Cooperative Chemicals Assessment Program was since the 1990’s the world’s only source of internationally agreed hazard assessments for large volume production chemicals. The program’s functions have now largely been taken over by Europe’s REACH program and various US activities and the program will be replaced by the end of next year. An OECD spokesman said that the organization should develop a new program based on new test methods.

The World Health Organization (WHO) has started a chemical risk assessment network in order to enhance global efforts to assess risks to human health from chemicals. It is expected to provide a forum for scientific exchange.

Unemployment across the seventeen European Union countries that use the euro hit a high of 12.1% in May, with the number of people out of work rising above nineteen million. Among the member states, the lowest rates were Austria at 4.7% and Germany at 5.3%. Youth unemployment in Spain and Greece has been reported at close to 60%.
Inflation in the Euro zone increased to 1.6% year to year in June, an increase from May’s 1.4%.

South Korea’s nine major companies have announced a plan to invest $2.45 billion over the next three years in order to prevent deadly chemical accidents. The plan is the result of a recent series of deadly accidents at Korean chemical plants.

Carload rail volume was up 2.7% annually in June on major US railroads. Intermodal volume was also up 2.7% compared with the same period last year. Total weekly traffic for carloads and intermodal units was up 1.2% annually. Petroleum products shipments were up 37.2%.

The American Trucking Association reported that seasonally adjusted for-hire truck tonnage increased 2.3% in May after falling an adjusted 0.2% in April.

Shale oil and Gas-related:

The EPA tabled a draft study that suggested that hydraulic fracturing (fracking) contaminated groundwater in Pavillion, WY. The agency stated that it “recognizes the state of Wyoming’s commitment to further investigation and efforts to provide clean water and does not plan to finalize or seek peer review of its draft Pavillion groundwater report.” The EPA further said that it plans to use the results of its ongoing national study to inform of its recommendations regarding fracking. The national study is expected in 2016.

Plentiful and inexpensive US shale gas is becoming a threat to the European petrochemical industry which is dependent on oil-based feedstock. European manufacturers, such as BASF, Ineos, and LyondellBasell are seen as particularly vulnerable.

Illinois is making plans to leverage abundant supplies of shale gas in order to fuel an economic revival. In early June, the Illinois legislature overwhelmingly endorsed the use of fracking as a first step.

According to the International Energy Agency, US natural gas production will accelerate from 2014 through 2018. Gas output will reach 797 billion cubic meters by 2018, 17% higher than last year. US shale production increased sixfold from 2007 to 2012.

Cuadrilla Resources, a British oil and gas company said that it was applying for a permit to hydraulically fracture an exploration well at Grange Hill, in Lancashire, England. The British government sees shale gas as possible replacement for the declining North Sea production. The UK formation is said to resemble the Barnett shale deposit in Texas.

The Economy

The Congressional Budget Office reported that the federal government incurred a budget deficit of $627 billion from October 2012 through May 2013 (the first eight months of fiscal 2013), almost $220 billion less than the shortfall recorded for the same period last year. The CBO’s updated estimates indicate a fiscal year deficit of $642 billion. The US Treasury Department reported that on July 2, 2013 the federal debt was $16.75 trillion. The national debt has increased an average of $3.81 billion per day since September 2007.

Personal income in May increased by $69.4 billion, or 0.5% compared to April. In April, personal income decreased by $5.6 billion or less than 0.1%. In March, personal income increased $36.2 billion or 0.3%.
The US government debt held by foreign entities is in excess of $5.7 trillion, with China holding $1.26 trillion of it, or approximately 20% of all the debt owned by foreign entities. In January 2009 the US government owed $3.07 trillion to foreign entities. China remains the top creditor. Japan is a close second, holding $1.1 billion.

The Bureau of Economic Analysis revised estimate of the first quarter 2013 Gross Domestic Product showed an increase of 1.8%, that is from the fourth quarter of 2012 to the first quarter of 2013. The previous estimate was an increase of 2.4%. Revised fourth quarter real GDP increased 0.4%. In the third quarter, real GDP increased 3.1%. In the second quarter, real GDP increased 1.3%. Current-dollar GDP, the market value of the nation’s output of goods and services, increased at a revised rate of 3.1% or $120.0 billion in the first quarter of 2013 to a level of $15,984 billion. In the fourth quarter current dollar GDP increased 1.3% or $53.1 billion.

The Conference Board’s Leading Economic Index increased 0.1% in May to 95.2 (2002=100) following a 0.8% increase in April and a 0.3% decline in March.

The Conference Board Consumer Confidence Index which had improved in May increased again in June. It stands at 81.4 (1985=100) up from an adjusted 74.3 in May.

The Institute for Supply Management’s June Manufacturing Index registered 50.9%, an increase of 1.9% from May’s number of 49.0%, indicating expansion in manufacturing for the fifth time the first six months of 2013. The Non-Manufacturing Report for June was 52.2%, or 1.5% lower than the 53.7% reported for May, reflecting continued growth, but at a slower rate.

In May, retail and food services sales adjusted for seasonal variations were $421.1 billion, an increase of 0.6% from April and 4.3% above May 2012. March through May 2013 sales were up 3.7% from the same period a year ago.

Privately owned housing starts in May of 914,000 were 6.8% above the revised April estimate of 856,000 and were 28.6% above the May 2012 rate of 711,000. Single family housing starts in May were at a rate of 599,000 or 0.3% above the revised April figure of 597,000. New single home sales in May were at a seasonally adjusted annual rate of 476,000. This was 2.1% above the revised April rate of 466,000 and 29.0% above the May 2012 estimate of 369,000.

The National Association of Realtors reported that sales of existing homes rose in May. Existing home sales increased 4.2% to a seasonally adjusted annual rate of 5.18 million units, an increase of 12.9% from the same period a year ago. Distressed homes, foreclosures and short sales, accounted for 18% of May sales, unchanged from April, but the lowest number since monthly tracking began in 2008. They were 25% a year ago.

New orders for manufactured durable goods in May increased $8.0 billion or 3.6% to $231.0 billion. This increase, up three out of the last four months, followed a 3.6% increase in April.

May unfilled orders for manufactured durable goods increased $8.1 billion or 0.8% to $1,004.7 billion. This followed a increase of 0.3% in April.

Consumer Price Index for all urban consumers increased 0.1% in May on a seasonally adjusted basis. The US Bureau of Labor Statistics reported that over the last twelve months the all items index increased 1.4 % before seasonal adjustments. Food index, which rose in April, declined 0.3% in May. The shelter index rose 0.3% and accounted for more than half of the May increase.

The Producer Price Index for all finished goods increased 0.5 % in May, seasonally adjusted, following decreases of 0.7% in April and 0.6% in March. On an unadjusted basis prices for finished goods increased 1.7 % for the twelve months ended in May 2013.

Interest rate: Prime at 3.25%, unchanged since 12/16/08.
Inflation: Inflation rate in May reported at 1.4%. The April rate was 1.1%, March rate was 1.5%, February rate was 2.0%, and January rate was 1.6%. The average rate of 2.1% was reported for 2012. It is expected to rise slightly in 2013 to approximately 2.0%.

Industrial production was unchanged in May, having decreased 0.4% in April and increased 0.4% in March after having increased 1.1% in February. For the first quarter as a whole, output increased at an annual rate of 5.0%, the largest gain since the first quarter of 2012. At 98.7% of its 2007 average, total industrial production in May was 1.6% above its year-earlier level. Capacity utilization rate for total industry decreased to 77.6%, a rate 0.2% below the level of a year earlier, and 2.6% below its 1972 – 2012 average.

Unemployment: The June 2013 rate was little changed at 7.6%, and has shown little movement since February. The number of unemployed persons was reported at 11.8 million, basically unchanged. The Bureau of Labor Statistics stated that the long-term unemployed, i.e., jobless for 27 weeks and over was essentially unchanged at 4.3 million in June. Those individuals accounted for 36.7% of the unemployed. Over the past twelve months, the number of long-term unemployed has declined by one million. North Dakota continued to lead the nation with the lowest state unemployment rate in May of 3.2%; Nevada was reported highest at 9.5%, Illinois, Mississippi, and California close behind. An analysis completed for the US Conference of Mayors said that more than half of all US metro areas won’t regain the jobs lost in the recession until the second half of 2015 or later.