Company Profile: An Introduction to BASF
BASF is headquartered in Ludwigshafen and has more than 350 plants and companies in 39 countries. More than 60 production sites are in Germany itself, located in cities including Ludwigshafen, Muenster, Hamburg, Stuttgart, Mannheim, Wuerzburg, and Cologne. The BASF Group headquarters and BASF Aktiengesellschaft in Ludwigshafen are like a small city covering 7 square kilometers. This small city has 1,750 buildings, 100 km of streets, 200 km of railway track, 2,500 km of pipelines, and five power plants; BASF also has its own hospital, travel agency, and railway station. A total of 55,000 people work in Ludwigshafen. BASF SE is the largest company in the BASF Group. Many BASF products are derived from crude oil and natural gas, and BASF owns its own coal, oil, and gas resources. Its subsidiary Wintershall AG explores for, produces, and refines crude oil and natural gas around the world, and also supplies feedstocks such as natural gas, benzene, cyclohexane, and naphtha to companies within the BASF Group. Most of BASF's operations outside Germany are in Europe, covering almost every European country. It also has subsidiaries or plants in the United States, Japan, Argentina, India, Singapore, Egypt, and China, among others.
BASF is the world's leading chemical company, offering customers a broad range of high-performance products spanning chemicals, plastics, performance products, crop protection products, and crude oil and natural gas. Its distinctive integrated production concept (Verbund in German) is the company's key strength: it gives BASF a low-cost advantage and therefore a major competitive edge. BASF conducts its business according to the principle of sustainable development. In 2012 BASF's sales reached 72.129 billion euros and it had more than 111,000 employees worldwide. BASF shares are listed on the Frankfurt (BAS), London (BFA), and Zurich (AN) stock exchanges.
BASF (China) Company Limited, Beijing Branch
Building on this, industry experts have also carried out a great deal of research and improvement.
At that time China's textile industry was booming. Seizing the opportunity, BASF sent a representative, Meyer, to Shanghai in 1885 to sell dyes. In this Chinese city known for leading clothing fashion, BASF dyes became best sellers. From then on BASF formally entered the Chinese market.
BASF is a large international chemical company that manufactures a wide range of products in 39 countries and does business with customers in more than 170 countries. Its global sales in 2012 were about 72.1 billion euros, and it had about 111,000 employees at the end of 2012.
Building on this, industry experts have also carried out a great deal of research and improvement.
Listening to customers, serving them, and meeting their needs is BASF's guiding principle. To put this principle into practice, the company continues to develop new products and strengthen its leading position in the market. In addition, it invests more than 2 billion marks each year in research and development around the world, providing strong support for BASF's future direction.
In fact BASF's future direction is not focused solely on commercial gain but also on the planet we live on. As social values change, people attach ever greater importance to safety and environmental protection. Both are vital to BASF's future success, and its participation in the global Responsible Care programme is an important contribution to sustainable development; the programme covers products and services across all BASF business areas and subsidiaries.
At the same time, the supporting processes and equipment are being continuously optimized and upgraded.
Sales in the Plastics segment grew thanks to higher volumes, higher product prices, and favorable currency effects. Demand from the automotive industry remained strong, particularly in North America and Asia. EBIT before special items increased sharply as earnings in the Polyurethanes division improved significantly. Full-year 2012 sales rose to 11.4 billion euros, up 4% year on year. EBIT before special items fell 27% year on year to 873 million euros.
In addition, this technology is also widely applied and practised in related fields.
Driven by higher crude oil production in Libya and increased natural gas trading volumes, sales in the Oil and Gas segment grew strongly in the fourth quarter of 2012. The start-up of new wells at the Achimgaz joint venture also contributed. EBIT before special items rose significantly; special items of 120 million euros related to loss provisions for the Yme development project in Norway. Non-compensable income taxes on oil production amounted to 492 million euros. Net income was 250 million euros, down 9%. Full-year sales reached 16.7 billion euros, up 39%, and EBIT before special items was 4.1 billion euros, nearly double. Net income also rose to 1.2 billion euros.
It is worth noting that the technologies and standards in this field are also developing and improving all the time.
The BASF Group has produced dyes for more than a century and ranks first in the world in both dye and pigment output and exports. Petrochemicals, as its key development direction and main business area, hold a very important position worldwide. The BASF Group is Europe's fifth-largest and the world's fourteenth-largest ethylene producer. In April 1993 it completed a 600,000 t/a cracker, a 250,000 t/a ethylene oxide unit, and a 160,000 t/a acrylate unit in Antwerp, Belgium. In March 1994 the BASF Group bought two 150,000 t/a polypropylene units from ICI, becoming Europe's second-largest and the world's fifth-largest polypropylene producer.
The BASF Group is also the world's largest acrylic acid producer, with capacity of 600,000 t/a in Europe and North America, twice that of second-ranked Rohm and Haas. The group also holds an important position in world polystyrene production, ranking second in capacity.
Beyond this, many factors must be considered in actual engineering applications.
Drawing on the group's technical strengths and strategic direction, in 1980 it developed animal disinfectants and mineral elements, devoting itself to researching, developing, producing, and selling animal health products and contributing to the nutrition and disinfection of livestock and poultry. Products include polyvinylpyrrolidone raw material, iodic acid, magnesium, sulfur, and potassium. It created the leading disinfectant brand (Lectra-60) and the world's largest mineral production workshop, with global sales of 1.28 billion euros in 2003. Its business covers Europe, Asia, South America, and North America. In 2008 an animal health business unit was established in China, creating another success for the company in the animal health industry.
Building on this, industry experts have also carried out a great deal of research and improvement.
A hallmark of the BASF Group's research is that, besides the strong central research departments at the Ludwigshafen headquarters, it has set up many local development departments around the world to conduct research locally. The central research facilities in Ludwigshafen include four long-established laboratories covering chemicals, plastics, pharmaceuticals and crop protection products, and dyes, auxiliaries and specialty chemicals. Several engineering development departments also support the overall research effort. Research units around the world belong to the individual business divisions and subsidiaries and mainly carry out research related to production and marketing. World-leading process technologies of the BASF Group in petrochemicals include:
Building on this, industry experts have also carried out a great deal of research and improvement.
This technology was commercialized in 1977. Worldwide, polypropylene capacity based on it has reached 1.7 million t/a, making it the second most widely used polypropylene production technology after Himont's loop process.
Beyond this, many factors must be considered in actual engineering applications.
The Reppe process for producing 1,4-butanediol from formaldehyde and acetylene was first commercialized by BASF, which in 1975 improved it into the modified Reppe process (the atmospheric-pressure Reppe process). This process uses a suspension-bed flow scheme in which catalyst and product are separated inside the reactor, and it is one of the world's most important 1,4-butanediol production processes today.
Building on this, industry experts have also carried out a great deal of research and improvement.
This technology was commercialized in the early 1980s, and BASF used it to build a 100,000 t/a formic acid plant. The process first reacts CO with methanol to form methyl formate, which is then hydrolyzed in the presence of an extractant to give formic acid.
Moreover, from the perspective of industrial development, market demand is also driving technological progress.
As early as 1952 BASF obtained the patent rights to expandable polystyrene production technology. The group produces expandable polystyrene at 11 sites on four continents and has developed a series of more than 30 different grades under the trade name Styropor, with output ranking first in Europe.
Through long-term petrochemical production practice, BASF has gradually built up a series of hydrofining and hydrotreating catalysts characterized by olefin and aromatic hydrogenation, hydrodesulfurization, hydrodenitrogenation, hydrodemetallization, and the hydrofining of lubricating oil and wax, together with the technology to make them. These catalysts can be used to refine and treat various feedstocks and are widely applied in petrochemicals.
In addition, this technology is also widely applied and practised in related fields.
As early as 1982 BASF established BASF China Limited in Hong Kong, responsible for the sale, promotion, and distribution of imported and locally produced products in Hong Kong and the Chinese mainland. Upholding BASF's century-old tradition, BASF China Limited provides customers with expertise and services that improve quality and efficiency and enhance their market competitiveness.
To strengthen its Chinese operations, BASF set up the holding company BASF (China) Company Limited in 1996. Legally registered in Beijing, this new company provides logistics coordination, electronic data processing, procurement, human resources, finance, and sales services for all BASF joint ventures in China.
BASF now has more than 6,000 employees in the Greater China region, with 23 wholly owned subsidiaries and 10 joint ventures located in Hong Kong, Beijing, Shanghai, Nanjing, Guangzhou, Jilin, Shenyang, and Hsinchu. To meet local market needs, the company has offices in Hong Kong, Beijing, Shanghai, Guangzhou, Nanjing, Qingdao, and Taipei. In 2007 BASF's sales in Greater China were about 4.4 billion euros. Its main business areas in Greater China include petrochemicals, polymer dispersions, polystyrene, polyurethanes, engineering plastics, coatings, performance products for textiles and leather, intermediates, catalysts, and construction chemicals.
BASF has set ambitious plans to take part in China's economic development. At present about 2,200 employees work in its China business, and sales in 1997 exceeded 1.1 billion marks. The sales target for 2000 was 2 billion marks, 30% of which would be produced in China. BASF continues to develop actively, aiming to become one of the major chemical companies in the Chinese market.
At the same time, the supporting processes and equipment are being continuously optimized and upgraded.
BASF plays an important role in China's chemical market, taking part in ten joint ventures whose entire product ranges are coordinated with the company's two major production bases in Shanghai and Nanjing. New plants built with the latest technology ensure that BASF and its Chinese partners hold a firm place in this rapidly growing market.
The brand ranked 286th in the 2006 World Brand 500 list compiled by the World Brand Lab, and the company ranked 62nd in the 2012 Fortune Global 500.
Beyond this, many factors must be considered in actual engineering applications.
BASF Applied Chemicals Co., Ltd. was founded in 1994 and has been a wholly owned BASF production company since 2000. It produces specialty chemicals such as leather and textile auxiliaries and dispersions. In June 2007 BASF set up a new polyurethane specialty products production base in Pudong: BASF Polyurethane Specialties (China) Company Ltd., comprising a polyurethane system house, a technical R&D center, and a thermoplastic polyurethane (TPU) production unit.
Beyond this, many factors must be considered in actual engineering applications.
BACC was founded in 1994, originally as a joint venture between BASF and Shanghai Dyestuffs Company. It has been a wholly owned BASF production base since 2000 and plays a very important role in BASF's Asia Pacific production network.
At the same time, the supporting processes and equipment are being continuously optimized and upgraded.
In 2005 BASF acquired the global electronic chemicals business of Merck KGaA. The former Merck Electronic Chemicals (Shanghai) Co., Ltd. was renamed BASF Electronic Materials (Shanghai) Co., Ltd.
At the same time, the supporting processes and equipment are being continuously optimized and upgraded.
In December 2000 BASF and China Petroleum and Chemical Corporation (SINOPEC) established a joint venture in Nanjing, Jiangsu: BASF-YPC Company Limited (BYC), to build and operate an integrated petrochemical site. Total investment reached 2.9 billion US dollars, with BASF holding a 50% stake. At the heart of the integrated site is a steam cracker that supplies feedstock to nine world-scale downstream plants; it went into commercial operation in mid-2005, with a grand start-up ceremony in September. The site produces 1.7 million tons of high-quality chemicals and polymers a year to meet domestic demand, and the company employs about 1,500 people.
At the same time, the supporting processes and equipment are being continuously optimized and upgraded.
BASF Taiwan Cyanamid Agricultural Chemicals Co., Ltd. (BTCC) is a 55 (BASF) to 45 joint venture established with Taiwan Sugar Corporation after the transaction was completed in December 2002. The production site in Hsinchu has an annual capacity of 12,000 tons and produces high-quality crop protection formulations.
In addition, this technology is also widely applied and practised in related fields.
The BASF Group sets up subsidiaries in the regions and countries that are its main or priority growth markets, directly guiding the development of the local business. In 1996 the group established a health and nutrition company headquartered in Denmark and BASF (China) Company Limited headquartered in Beijing.
3. Forming joint ventures or alliances with competitors to create complementary technical and production strengths and enhance competitiveness: the BASF Group set up a Heidelberg-based joint venture with the US company Lynx to conduct biotechnology and genetic engineering research. The group also planned to combine its polyethylene business with Shell's, creating a joint venture responsible for the European polyethylene businesses of Rhine Olefins (50% BASF, 50% Shell) and the acquired Montell Polyolefins. The combination with Shell would create the joint venture BASELL, which would build a new plant in Moerdijk, the Netherlands, to produce propylene oxide and polypropylene. Its European unsaturated olefins business would be placed in a joint venture with DSM of the Netherlands. The BASF Group also planned to set up a joint venture with Hoechst to run their polypropylene businesses together.
Moreover, from the perspective of industrial development, market demand is also driving technological progress.
The BASF Group has strong financial resources, and its capital expenditure has grown steadily in recent years. Although fixed-asset investment has not stayed at the roughly 4 billion mark level of 1989-1993, it has trended steadily upward since 1994, with more than 3.8 billion marks planned for 1997. Looking at the segment distribution of capital expenditure, health and nutrition has been rising and has accelerated in recent years. After four years of decline, capital expenditure on chemicals and on plastics and fibers increased again in 1996. Dyes and coatings, as the group's traditional core business, has developed steadily, which is also reflected in its capital expenditure. Capital expenditure on oil and gas has fluctuated considerably. Spending on other business areas has grown steadily over the past three years but is clearly lower than before 1993. Overall, the group's capital expenditure follows its development strategy: dyes and coatings, chemicals, and plastics and fibers, as traditional strengths, have developed steadily; health and nutrition, as a new core area, is developing well; and oil and gas, as a feedstock source, has also grown steadily over the past three years.
In terms of the geographic distribution of capital expenditure, the European market is its solid focus, with almost half of the spending in Germany. North America is a priority for expansion. The group's capital expenditure in Asia Pacific, Africa, and South America accounts for the smallest share, and within Asia Pacific its investment focus is China, followed by South Korea.
