Factbook

Portfolio

Investments are a key driver of profitable growth. To achieve our climate protection goals, we are also making targeted investments in modern and more sustainable technologies and processes. Our growth projects play a central role, particularly the new Verbund site in Zhanjiang, China, which we are planning from the outset as a pioneer for sustainability. We are continuously optimizing our portfolio through targeted acquisitions and divestitures.

We continued to drive forward our growth projects in 2023 and further expand our position in our three key regions: Asia Pacific, North America and Europe. The Asia Pacific region and China in particular, which already has a significant influence on the growth of the global chemicals market with a share of around 50%, will continue to play a key role here. To serve the increasing needs of various growth industries in this region, we are continuously expanding our market position in China. One example of this is the construction of our new integrated Verbund site in Zhanjiang. In North America, among other things, we have been further expanding our production capacities in the isocyanates value chain in 2023. In Europe, the opening of the first co-located battery materials and recycling center at the Schwarzheide site in Germany was a milestone on our way to further expanding our position in this area.

Further information on the planned Verbund site in Zhanjang

In addition, we want to refine our portfolio through smaller, bolt-on acquisitions that promise above-average profitable growth and help to expand our market position in a targeted manner. A key consideration is that these acquisitions are innovative, offer a technological differentiation, or make new, sustainable business models possible.

Investments

Investments in property, plant and equipment amounted to €5,864 million in 2023 (2022: €4,842 million). Capital expenditures (capex)¹ accounted for €5,198 million of this amount (2022: €4,148 million). Our investments in 2023 focused on the Chemicals, Materials, Surface Technologies and Nutrition & Care segments.

Capex: selected projects

Location	Project
Chalampé, France	Construction of a world-scale production plant for hexamethylenediamine
Geismar, Louisiana	Capacity expansion at MDI plant
Ludwigshafen, Germany	Modernization of chloroformates and acid chlorides plant
Zhanjiang, China	Construction of an integrated Verbund site

Capex by segment 2024–2027

Capex by region 2024–2027

We are planning capex of around €6.2 billion for the BASF Group in 2024, including €3.3 billion for our growth projects, in particular the construction of the new Verbund site in China. For the period from 2024 to 2027, we are planning capex totaling €19.5 billion, including €6.8 billion for our growth projects – the new Verbund site in China, and the expansion of the battery materials business. The investment volume in the next four years will thus be considerably below that of the planning period 2023 to 2026 (€24.5 billion).

¹ Additions to property, plant and equipment excluding acquisitions, restoration obligations, IT investments and right-of-use assets arising from leases

Acquisitions

We did not make any acquisitions in the 2023 business year.

Divestitures

The divestiture of BASF’s nickel-based catalysts production site in De Meern, Netherlands, to IQatalyst B.V., a subsidiary of ASC Investment Sàrl, Luxembourg, which had been announced in July 2022, was closed on August 31, 2023. BASF had decided to divest the site and the related Fischer-Tropsch and FOCAT¹ portfolio to increase the efficiency of its global chemical catalysts production network. The site was part of BASF’s Catalysts division until the completion of the divestiture process. The transaction mainly covered production plants, including the associated infrastructure and inventories, as well as the transfer of the employees working at the site.

1 Fat and Oil CATalysts

Agreed transactions

On December 21, 2023, BASF, LetterOne and Harbour Energy plc (Harbour) signed an agreement to combine the businesses of Wintershall Dea and Harbour. The E&P business of Wintershall Dea is to be transferred to Harbour: It comprises production and development assets as well as exploration rights in Norway, Argentina, Germany, Mexico, Algeria, Libya (excluding Wintershall AG), Egypt and Denmark (excluding Ravn), and Wintershall Dea’s carbon storage (CCS) licences. In exchange, at closing, the shareholders of Wintershall Dea will receive total cash consideration of $2.15 billion (BASF share: $1.56 billion) and new shares to be issued by Harbour equating to a total shareholding in the enlarged Harbour of 54.5% (BASF share: 39.6%).

Until the completion of the transaction, which is, among other things, subject to antitrust approvals and further official approvals for foreign investments in various countries, Wintershall Dea and Harbour will continue to operate as independent companies. Subject to these regulatory approvals, closing is targeted for the fourth quarter of 2024.

Wintershall Dea is accounted for as a non-integral shareholding using the equity method. After completion of the transaction, both the shareholding in Wintershall Dea, which will then only include the businesses not transferred to Harbour and the head offices, and the shareholding in Harbour will be accounted for using the equity method in the Consolidated Financial Statements of the BASF Group.

New Verbund site in Zhanjiang

Construction in progress at BASF’s Zhanjiang Verbund site (status April 2024)

In recent years, market growth in China has been driven by increased domestic consumption, higher standards of living as well as more local value creation. With a global market share of around 50%, China is the largest chemical market and drives the growth of global chemical production. BASF is very well prepared to capture future growth in China. We have built an extensive network throughout the country. The following sites are the backbone of our activities in China:

Shanghai is home to our Greater China headquarters, one of our two Innovation Campuses in the Asia Pacific region as well as our Caojing production site.
Nanjing is the location of our joint venture Verbund site with Sinopec as well as a wholly owned site.
In Chongqing, we operate a wholly owned MDI production complex.

At the end of December 2023, BASF had 12,115 employees in Greater China, 27 wholly owned subsidiaries and 30 production sites. In 2023, BASF posted sales of approximately €9.4 billion to customers in Greater China.

To accelerate our growth in Asia, BASF commenced its Verbund project in Zhanjiang in the southern Chinese province of Guangdong in 2019. The fully owned BASF Verbund site will involve a total investment of around €10 billion. When completed, the site will be BASF’s third-largest Verbund site globally. In 2022, BASF made the final investment decision for the main construction phase of the Zhanjiang Verbund site, including a steam cracker and downstream plants to support our customers’ growth in the dynamic Chinese market.

Construction of the first plants started in 2020. A plant started up in July 2022 provides engineering plastics compounds to meet growing demand from the Chinese automotive and electronics industries. In addition, a production plant for thermoplastic polyurethane (TPU) came on stream in September 2023. The startup of the core of the Verbund – a steam cracker and plants for ethylene oxide, syngas, monoethylene glycol, polyethylene, oxo-C4 alcohols, acrylic monomers and neo¬pentyl glycol – is expected to take place as of 2025. Further value chain expansion is expected to be operational as of 2028.

Guangdong is home to key customers from fast-growing industries

Market characteristics⁵

Nearly 127 million residents in Guangdong province (2022)
GDP Guangdong (2023):
> $1.92 trillion (exceeding Brazil)
GDP CAGR 2023–2038:
~4.7% p.a.
Key customer industries: transportation, consumer goods, home and personal care, electronics
Chemical products are generally undersupplied from local production

1 Industry real output, 2015-based, Guangdong Bureau of Statistics
2 Real chemical gross output, 2015-based, inferred by gross output/value added ratio for China, Guangdong Bureau of Statistics
3 Guangdong Bureau of Statistics
4 Real private consumption, 2015-based. National Bureau of Statistics with S&P Global forecast, subject to retrospective revision
5 Guangdong Bureau of Statistics, S&P Global

With around 127 million residents, Guangdong is the most populous province in China. The province is the economic powerhouse of China and accounted for more than 10% of the country’s GDP in 2023. Guangdong province is home to many BASF customers in fast-growing industries such as transportation, consumer goods, home and personal care, and electronics. Zhanjiang has a deep-water seaport with easy access to shipments of raw materials and finished goods to and from other ports in China, Asia and other regions. It also offers the shortest sea routes between mainland China and Southeast Asia. The government of Guangdong province is committed to providing this area with world-class infrastructure.

BASF is committed to building the Zhanjiang Verbund site as a model for sustainable production. We aim to power the entire site with 100% renewable electricity. As BASF’s first implementation of a fully digital smart Verbund concept in a large-scale project globally, the site will be built on the basis of cutting-edge technologies that maximize resource and energy efficiency and reduce environmental impact. Circular economy concepts will be incorporated into the new Verbund site to support customers in the region with low-carbon solutions.

Last UpdateMay 27, 2024