U.S. total exports of chemicals and related products rose by $3.4 billion (1.5 percent) to $234.7 billion. The rise in exports was driven by the increased popularity of higher-priced specialty pharmaceuticals in Europe and opportunities created by plastics feedstock supply issues in Mexico. These factors outweighed the decrease in exports of organic chemicals attributable to a combination of expanding production capacity and shrinking demand in East Asia. The markets that accounted for the largest increase in domestic exports were Mexico (up $1.8 billion, or 5.7 percent), Belgium (up $1.7 billion, or 12.9 percent), and the Netherlands (up $1.3 billion, or 15.9 percent) (Table CH.1).

U.S. general imports of chemical and related products rose by $14.9 billion (6.3 percent) to $251.6 billion. Increased spending on high-value pharmaceuticals targeting relatively small patient groups and expanded use of plastic products in the U.S. packaging, construction, transportation, and electronics industries contributed to the rise of imports. These factors outweighed a decline in imports of fertilizers that resulted from increased U.S. production and the effects of low crop prices on demand. The countries that accounted for the largest increases in imports were Germany (up $3.3 billion, or 15.1 percent) and China (up $2.4 billion, or 8.2 percent).

U.S. Exports¹

U.S. chemical domestic exports primarily increased in two areas: medicinal chemicals and miscellaneous plastic products. The largest decline in exports was in organic commodity chemicals (table CH.2).

U.S. domestic exports of medicinal chemicals increased by $3.5 billion (7.1 percent) because of trade in immunological products and biologic medical products, which are typically more expensive than traditional chemical pharmaceuticals. Monoclonal antibody therapies, which treat rheumatoid arthritis and similar inflammatory diseases, contributed to the $2.5 billion increase in the exports of immunological products.² Among biologic medicines, a key contributor to this shift was likely the introduction of new products, including two that treat hepatitis C.³

U.S. domestic exports of miscellaneous plastic products increased by $1.3 billion (5.3 percent). Much of this rise, $455.6 million, was accounted for by U.S. trade with Mexico.⁴ This shift may be linked to shortfalls in Mexican petrochemical feedstock and plastic resin production that started in 2013 and continued into 2014, reducing domestic Mexican production of plastic products and resulting in increased Mexican purchases of some plastic products from the United States.⁵

Exports of organic commodity chemicals experienced the largest decrease, down $1.0 billion (13.8 percent) to $6.3 billion in 2014. The decline was largely driven by competition from increased production in Asia of paraxylene (used in the production of polyester) and decreased styrene demand in China. In 2014, paraxylene production capacity increased in Singapore⁶ and South Korea, while demand for the chemical was decreasing. U.S. exports of paraxylene to Singapore experienced the largest decline (falling $343.7 million),⁷ softening in parallel with demand for polyester.⁸ During the year, exports of styrene to China fell by $315.9 million⁹ as demand declined in that country, in part due to a slowdown in construction and to government efforts to decrease domestic spending on luxury goods and housing.¹⁰

U.S. Imports

U.S. imports of chemicals and related products rose by $14.9 billion (6.3 percent) in 2014. This trend was driven by medicinal chemicals, which rose by $8.1 billion (9.4 percent), and miscellaneous plastic products, which rose by $1.9 billion (6.6 percent).

Imports of medicinal chemicals increased because of higher prices and the international nature of pharmaceutical supply chains. Spending on pharmaceuticals rose 13 percent in the United States in 2014. In part this higher spending reflects the increased usage of higher-priced specialty pharmaceuticals, which are often focused on smaller patient groups. Such products require more complex production, handling, administration, and monitoring than traditional pharmaceuticals. Another factor contributing to the price increase was the fact that fewer major pharmaceuticals went off patent than in 2013, resulting in less cost limitation through generic pharmaceutical production.¹¹ Also, much of international pharmaceuticals trade is related-party trade within large companies. The increase in imports in 2014 likely reflects multinational firms operating in the United States using facilities in other countries, most notably Switzerland and Ireland,¹² to meet growing U.S. demand. Switzerland and Ireland combined accounted for $2.4 billion of the increase in U.S. imports.¹³

U.S. imports of miscellaneous plastic products increased by $1.9 billion in 2014. The rise was broadly spread among a variety of products and countries and likely reflects increased economic activity in high-use markets such as packaging, construction, transportation, and electronics.¹⁴

U.S. imports of fertilizers declined $737 million. One likely reason for this was an increase in U.S. domestic capacity for nitrogen fertilizer production because of lower natural gas prices.¹⁵ Another probable reason was a reduction in U.S. usage of potash and phosphate fertilizers (which are generally not applied on an annual basis) linked to lower crop prices.¹⁶