European future in doubt as energy price-hikes cost BASF billions
Chemicals group BASF has said increases in energy prices in 2022 have hit it hard. On releasing its results for the third quarter of the year, the group said its use of natural gas at its European sites had cost it an extra €2.2 billion compared to the same period in 2021.
BASF reported sales revenues of €21.9 billion for the third quarter, which represented growth of 12% year on year, but its pre-tax profit on this figure, €1.3 billion, was down by more than €500 million on the same quarter in 2021.
On releasing these results, the chairman of the group’s board of executive directors, Dr Martin Brudermüller, announced a cost-saving programme, focused on BASF’s activities in Germany and in other parts of Europe, which he said would yield combined savings of €1 billion in 2023 and 2024.
“The European chemicals market has been growing only weakly for about a decade,” Dr Brudermüller said. “Secondly, the significant increase in natural gas and power prices over the course of this year is putting pressure on chemical value chains. Moreover, uncertainties about the enormous number of regulations planned by the European Union are weighing on the chemical industry.”
He said all of this could “endanger the international competitiveness of European producers” and said measures such as BASF’s cost-saving programme were necessary for the safeguarding of its medium- and long-term competitiveness in Germany and in the rest of Europe.
Image shows the BASF plant in Ludwigshafen, Germany.
