German Chemical Giant Hopes to Seize the Opportunity in China

Special Correspondent of the Paper in Germany, Qing Mu

According to Deutsche Presse-Agentur and the website of German NTV TV station on April 4th, the German chemical giant BASF Group will officially launch its comprehensive production base in Zhanjiang, China in the first quarter of this year. A previous survey by the China-German Chamber of Commerce showed that German chemical companies generally hold an optimistic view of the growth prospects of the Chinese market. According to BASF, China accounts for about 50% of the global chemical market, and the company hopes to seize this opportunity.

    According to the report, the Zhanjiang base cost about 8.7 billion euros and is the largest single investment project in BASF's history. The base is a comprehensive industrial base integrating production facilities, logistics, and material flow. This base will also become the third largest integrated production base of BASF following the Ludwigshafen base in Germany and the Antwerp base in Belgium.

    BASF believes that the Chinese market is an indispensable part of its future development. The company expects that about 80% of the growth in the global chemical industry will be concentrated in the Asia-Pacific region by 2035, and China already accounts for about 50% of the global chemical market. "Given this, BASF's share in China, the company's largest market, is still insufficient: In 2024, BASF's sales in China accounted for about 13% of the group's total sales. Its market share is far lower than that of the US market and even the European market," the company said.

    According to the report, German chemical companies generally have an optimistic view of the growth prospects of China. A business confidence survey released by the China-German Chamber of Commerce in December last year showed that 84% of chemical companies operating in China expect the annual average growth rate to increase over the next five years. 61% of the companies said they plan to increase their investment in China in the next two years.

    For some time, BASF has been troubled by weak demand and falling prices. In addition to sluggish growth, the US tariff policy has also exacerbated the company's difficulties. BASF CEO Martin Brudermüller recently told the German newspaper Handelsblatt, "The chemical industry may be experiencing the most difficult period in 25 years." German media mentioned that the company's major shareholders are worried that through its investments in China, BASF is increasingly relying on the Far East as a leading market. However, BASF stated that the expansion of its business in China does not mean focusing on a single market or transferring production. Most of the products produced by BASF in China are sold in China.

Original: toutiao.com/article/1853556388148224/

Statement: The article represents the views of the author.