Segment profile The Chemicals segment consists of the Petrochemicals, Monomers and Intermediates divisions. In our integrated production facilities – our Verbund – we produce a broad range of basic chemicals and intermediates in Europe, Asia, North America and South America. Divisions Petrochemicals Broad range of basic products and specialties for sectors such as the chemical and plastics industries Monomers Isocyanates and polyamides as well as inorganic basic products and specialties for various sectors, such as the plastics, automotive, construction and electronics industries Intermediates Most comprehensive intermediates portfolio in the world, including precursors for coatings, plastics, textile fibers and crop protection products Sales Factors influencing sales Income from operations before special items (million €) 1 Restated figures; for more information, see Business review How we create value – an example Ultramid® Flex F38 High-performance copolyamide for more sustainable packaging solutions Value for BASF >25 % Expected average sales growth by 2025 Value for the environment and society approx. 25 % Fossil raw material savings Ultramid® Flex F38 gives plastics – like those used in food packaging – exceptional properties such as high tear resistance, transparency and softness even at lower temperatures. The innovative copolyamide is partly made from renewable raw materials, enabling our customers to offer more sustainable packaging solutions. We expect the product to generate average sales growth of over 25% by 2025. BASF uses a monomer made from a regionally-grown rapeseed oil in the production of Ultramid® Flex F38. This reduces the consumption of fossil raw materials by around 25% compared with conventional polyamides, and also cuts greenhouse gas emissions of CO2 equivalents 2 by 25% in the production process. These emissions are already lower than industry standards in BASF’s Verbund production. 2 Different gases contribute to global warming to different degrees. In order to compare their impact, emissions are usually converted into CO2 equivalents. Strategy Integrated production facilities form core of Verbund Technology and cost leadership provide most important competitive edge With its production facilities, the Chemicals segment is at the heart of the Verbund structure and supplies BASF’s segments with basic chemicals for the production of downstream products. We add value with innovations in processes and production, and invest in future markets. As a reliable supplier, we provide chemicals of consistent quality and market them to customers in downstream industries. We continually improve our value chains and are expanding our market position – particularly outside Europe – with new processes and technologies, as well as through investments and collaborations in future markets. We invest in research and development in order to develop new technologies and to make our existing technologies even more efficient. Cost leadership and a clear orientation along individual value chains are among our most important competitive advantages. We concentrate on the critical success factors of the classic chemicals business: making use of economies of scale, the advantages of our Verbund, high capacity utilization, continuous optimization of access to raw materials, lean processes, and reliable, cost-effective logistics. Furthermore, we are constantly improving our global production structures and aligning these with regional market requirements. In Ludwigshafen, Germany, we will strengthen the Verbund by replacing our acetylene plant, which plays a central role for many products and value chains, with a modern, highly efficient plant by 2019. On September 18, 2017, we signed an agreement with Solvay on the acquisition of Solvay’s global polyamide business by BASF. Solvay and BASF aim to close the transaction in the third quarter of 2018 after regulatory approvals have been obtained and the consent of a joint venture partner has been received. The purchase would strengthen our polyamide 6.6 value chain through increased polymerization capacities and the backward integration into the key raw material ADN (adipodinitrile). BASF plans to integrate Solvay’s global polyamide business into the Monomers and Performance Materials divisions. back next
