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Outlook 2025

Q3 2024

According to the most recent estimates, global gross domestic product (GDP) grew by around 2.7% in the third quarter of 2024 compared with the prior-year quarter.

In the European Union (E.U.), GDP grew by around 1% compared with the prior-year quarter, which was considerably below the global average. According to current expectations, Germany is in a recession, as GDP is expected to have decreased for the second time quarter-on-quarter. Germany’s economy is also estimated to have contracted compared with the third quarter of 2023. Italy’s economy grew slightly compared with the previous year, however at a rate expected to be less than 1%. Growth in France accelerated temporarily to more than 1%, due in part to the positive economic stimulus generated by the Olympics. GDP growth in Spain was considerably higher at around 3%.

According to current estimates, the U.S. economy’s momentum in the third quarter slowed just slightly. At nearly 2.5%, GDP growth is expected to be considerably stronger than in the E.U. However, this growth continued to be heavily driven by services; the industrial economy in the United States remained weak.

In China, GDP growth weakened to just under 5% in the third quarter. Industry was a key driver of this economic development. From a demand perspective, domestic consumption nevertheless remained weak and growth was driven primarily by the solid export economy.

Based on preliminary, partly estimated data, global industrial production in the third quarter expanded by a total of 1.5% compared with the previous year. Developments varied by region: In the E.U., production in the manufacturing sector continued to decline, while in the United States it largely stagnated. By contrast, production in Asia’s large emerging markets expanded. Production in the manufacturing sector is estimated to have increased by around 5% in China and by some 3% in India. Together, the two countries account for around 40% of value creation in the global manufacturing sector.

By contrast, production in the automotive industry declined sharply overall: According to recent forecasts, around 1.2 million fewer vehicles were produced in the third quarter of 2024 than in the third quarter of the previous year, which reflects a decrease of more than 5%. This affected all major markets: In the E.U. and North America, production decreased by between 5% and 6%, in China by around 4%, in Japan by nearly 6% and by about 8% in South Korea.

In the consumer goods sector, demand for durables was particularly weak. By contrast, global food production increased moderately. According to recent estimates, production of care chemicals trended sideways.

Although long-term interest rates have now declined slightly, demand in the construction sector remained weak, especially for new construction in the private housing segment. In the E.U., construction activity declined. In the United States, real construction spending increased, while construction starts for private housing decreased by 6% compared with the prior-year quarter. In China, the crisis in the real estate market continued to have a negative impact on the construction sector.

The agricultural sector presented a mixed scenario: Lower prices for agricultural goods dampened demand for agrochemicals. Conversely, lower customer inventories in Europe and North America bolstered the market.

Global chemical production rose by around 4% in the third quarter of 2024 compared with the previous year. China drove global production with growth of around 6% and widely varying growth rates for individual products and segments. Outside China, by contrast, production increased on average by only around 1.5%. In the E.U., chemical production is estimated to have grown at an above-average rate of 3%. By contrast, chemical production in the United States stagnated.

The oil price averaged $80 per barrel (Brent crude) in the third quarter, below the level of the prior-year quarter ($86 per barrel). The fluctuation range was comparatively high with daily prices of around $70 to around $90 per barrel. While weak demand and Saudi Arabia’s announced production increase dampened oil prices, the conflicts in the Middle East temporarily boosted oil prices.

For the full year 2024, BASF’s assumptions for global chemical growth may prove to be too conservative. This will largely depend on whether chemical production in China can continue to grow at a high level. With respect to the industrial economy, however, leading economic indicators signal a global deceleration for the fourth quarter of 2024. Against this backdrop, BASF’s assumptions remain unchanged:

  • Growth in gross domestic product: +2.3%
  • Growth in industrial production: +2.2%
  • Growth in chemical production: +2.7%
  • Average euro/dollar exchange rate of $1.10 per euro
  • Average annual oil price (Brent crude) of $80 per barrel

The BASF Group’s forecast for the 2024 business year published in the BASF Report 2023 also remains unchanged:

  • EBITDA before special items of between €8.0 billion and €8.6 billion
  • Free cash flow of between €0.1 billion and €0.6 billion
  • CO2 emissions of between 16.7 million metric tons and 17.7 million metric tons

For the fourth quarter of 2024, there are risks from potential declines in prices and lower volume growth than expected. Opportunities may arise from a positive development in demand and margins.

The statements on opportunities and risks made in the BASF Report 2023 continue to apply overall. According to the company’s assessment, neither existing individual risks nor the sum of individual risks pose a threat to the continued existence of the BASF Group.

Our forecast for the BASF Group and segments for 2025 is based on the assumption that a moderate recovery in demand for goods will support the growth in gross domestic product and industrial production. In particular, the decline in consumer price inflation and the associated increase in real incomes are expected to boost consumer purchasing power in the United States and Europe. However, challenges such as increasing geopolitical uncertainty and a further escalation of trade conflicts in particular, will weigh on business and consumer confidence. Following the decline in automotive production in 2024, we expect stagnation in 2025. For the global chemical industry, we anticipate slightly higher growth compared with expectations for gross domestic product and industrial production. Growth in the chemical industry should result primarily from the anticipated expansion of the sector in China and other emerging Asian markets. We anticipate an average oil price of $75 for a barrel of Brent crude and an exchange rate of $1.05 per euro.

Earnings and free cash flow forecast for the BASF Group1

Forecast at Group level

Million € 2024 2025 forecast
EBITDA before special items 7,858 €8.0 billion to €8.4 billion
Cash flows from operating activities 6,946 €5.6 billion to €6.0 billion

Payments made for property, plant and equipment and intangible assets

 6,198 €5.2 billion
Free cash flow 748 €0.4 billion to €0.8 billion

In 2025, the BASF Group’s EBITDA before special items is expected to increase to between €8.0 billion and €8.4 billion (2024: €7.9 billion). The Materials, Nutrition & Care, Industrial Solutions2 and Surface Technologies segments2 are likely to contribute to this. For some, this may be primarily attributable to sales volume growth and, in some cases, also to higher margins. In the standalone business Agricultural Solutions, we forecast slightly higher volume-related earnings. EBITDA before special items for the Chemicals segment is expected to decrease slightly compared with 2024. In particular, earnings in the Petrochemicals division will be impacted by rising fixed costs in connection with the startup of the new Verbund site in China and scheduled turnarounds. The anticipated considerable earnings growth in the Intermediates division will only be able to partially offset this.

We forecast the BASF Group’s free cash flow to be between €0.4 billion and €0.8 billion (2024: €0.7 billion). This is based on expected cash flows from operating activities of between €5.6 billion and €6.0 billion, minus expected payments made for property, plant and equipment and intangible assets in the amount of €5.2 billion.

CO2 emissions forecast for the BASF Group

CO2 emissions are expected to be between 16.7 million metric tons and 17.7 million metric tons in 2025 (2024: 17.0 million metric tons). We anticipate additional emissions compared with the previous year from higher forecast production volumes based on rising demand. We will counteract this increase with targeted measures to reduce emissions, such as increasing energy efficiency and optimizing processes as well as continuing the shift to electricity from renewable energies through the shareholding in the Hollandse Kust Zuid offshore wind farm, for example.

1 For EBITDA before special items and free cash flow, “slight” represents a change of 0.1% to 10.0%, while “considerable” applies to changes of 10.1% and higher. “At prior-year level” indicates no change (+/-0.0%).
2 The assumptions for the Industrial Solutions and Surface Technologies segments already take into account the reclassification of the chemical and refining catalysts business as of January 1, 2025, and are based on correspondingly adjusted figures for 2024.

Sales and earnings forecast for the segments
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Disclaimer

This page contains forward-looking statements. These statements are based on current estimates and projections of the Board of Executive Directors and currently available information. Forward-looking statements are not guarantees of the future developments and results outlined therein. These are dependent on a number of factors; they involve various risks and uncertainties; and they are based on assumptions that may not prove to be accurate. BASF does not assume any obligation to update the forward-looking statements contained in this presentation above and beyond the legal requirements.

Last UpdateMarch 21, 2025