BASF announces streamlining of acrylic acid production in North America

MOUNT OLIVE, NJ, June 28, 2001 - As a result of a strategic review to optimize its acrylic acid manufacturing operation in North America, BASF today announced the closure of one of its three acrylic acid plants at its Freeport, Texas site.

The decision to close this 20-year old facility will result in a reduction in capacity of approximately 165 million pounds and will ensure that BASF remains one of the lowest cost producers of acrylic acid in the Gulf Coast region. It is an important step to secure this core business for BASF in North America and reflects the persistent adverse conditions of the acrylic acid market.

"This is a responsible and measured action to address market conditions and will improve the cost performance of BASF's acrylic acid operation in North America," said Annette Juhasz, Business Director, Acrylic Monomers. "We are doing the right thing at the right time."

BASF doubled its acrylic acid capacity in Freeport in 1997 to supply the NAFTA market and serve as an export base for Asia and South America. With the start-up of BASF's acrylic acid complex in Kuantan, Malaysia in 2000 as well as the butyl acrylate plant in Guaratingueta, Brazil later this year, capacity in Freeport can be reduced.

As the world's largest producer of acrylic acid with approximately 900 thousand metric tons of capacity worldwide, BASF remains totally committed to the acrylic acid business and will continue to be a leading supplier to its customers. Closure of this facility will not affect the two remaining acrylic acid plants at Freeport that can be de-bottlenecked to satisfy customer's supply needs as required.

As a result of this action approximately 25 employees will be re-assigned to temporary positions until permanent positions become available at the Freeport site.

End uses for acrylic acid include superabsorbent polymers, paper coatings, detergents, water treatment chemicals, adhesives, textiles and plastics.

About BASF

"BASF is the world's largest producer of chemicals and related products. Based in Mount Olive, NJ, BASF Corporation is the North American affiliate of BASF AG (Ludwigshafen, Germany), which is listed on the New York Stock Exchange under the trading symbol "BF."

BASF Corporation had sales of $7.9 billion in 2000. "We don't make a lot of the products you buy. We make a lot of the products you buy better®" summarizes BASF's diverse product mix including chemicals, polymers, automotive and industrial coatings, colorants, nylon fibers and agricultural products. BASF in North America employs more than 15,000 people at more than 50 locations. BASF Corporation can be found on the Internet at www.basf-corp.com." The slogan is a registered trademark of BASF Corporation.