Outlook 2023

Q3 2023

There was still very little momentum in the global economy in the third quarter of 2023. Global industrial production was nearly stagnant, with subdued demand for consumer durables in particular. Construction activity suffered from high construction and financing costs, especially in the United States and Europe. Demand in the automotive industry increased moderately compared with the very strong prior-year quarter and thus remained stable compared with the second quarter of 2023.

In the European Union, gross domestic product is expected to have stagnated in the third quarter, compared with both the previous quarter and the prior-year quarter. Germany in particular recorded negative development in the manufacturing sector in the third quarter of 2023. Production in the energy-intensive industries stabilized at a low level, and there has been no considerable recovery to date. While declining inflation rates and rising wages partially supported private consumption, the further rise in interest rates and the uncertain macroeconomic environment dampened companies’ propensity to invest and private households’ willingness to spend.

The economy in the United States remained stable in the third quarter despite the now high level of interest rates. Data available so far points to a growth in gross domestic product at a similarly high rate compared with the previous quarter. While industrial growth is expected to have declined slightly compared with the prior-year quarter, it could increase slightly compared with the second quarter of 2023. Production in the chemical industry was down slightly compared with the prior-year quarter but recovered somewhat compared with the previous quarter. Data on the development of consumer confidence and retail sales as well as the stable labor market point to solid growth in private consumption.

Growth in China accelerated again after a weak second quarter. The slow recovery in industrial production continued. According to official data, growth in the chemical industry in China increased considerably. Private consumer expenditure on consumer goods and services grew in the third quarter. However, weak export demand and the continuing decline in activity in the construction sector continue to weigh on the Chinese economy.

In the fourth quarter of 2023, BASF expects production in the global chemical industry to further stabilize. However, the macroeconomic outlook remains extremely uncertain in the current interest rate policy environment and in view of increasing geopolitical risks. Rising raw materials prices in particular could weigh on demand and margins.

Against this background, BASF has maintained its assessment of the global economic environment in 2023 (growth assumptions from BASF’s Half-Year Financial Report 2023; values rounded to half percentage points):

  • Growth in gross domestic product: 2.0%
  • Growth in industrial production: 1.0%
  • Growth in chemical production: 0.0%
  • Average euro/dollar exchange rate of $1.10 per euro
  • Average annual oil price (Brent crude) of $80 per barrel

The BASF Group’s forecast for the 2023 business year published in the Half-Year Financial Report 2023 also remains unchanged:

  • Sales of between €73 billion and €76 billion
  • EBIT before special items of between €4.0 billion and €4.4 billion
  • Return on capital employed (ROCE) of between 6.5% and 7.1%
  • CO2 emissions of between 17.0 million metric tons and 17.6 million metric tons

If chemical production does not stabilize, there are risks from a further decline in volumes and a stronger price reduction than expected. Opportunities may arise from a positive development in demand and margins.

For the remaining risk factors, the statements on opportunities and risks made in the BASF Report 2022 continue to apply overall. According to the company’s assessment, neither existing individual risks nor the sum of individual risks pose a threat to the continued existence of the BASF Group.

Report 2022

The high level of uncertainty that arose over the course of 2022 due to the war in Ukraine, high raw materials and energy costs in Europe, rising prices and interest rates, inflation and the development of the coronavirus pandemic will continue in 2023. All of these factors will negatively impact global demand, which is why we only expect moderate growth for the global economy in 2023.

Outlook for 2023 at a glance


of between €84 billion and €87 billion


EBIT before special items

of between €4.8 billion and €5.4 billion


of between 7.2% and 8.0%


CO2 emissions

of between 18.1 million metric tons and 19.1 million metric tons



of around €6.3 billion

We anticipate moderate growth in the majority of our customer industries and expect the slight recovery in the automotive industry in particular to continue. Our forecast assumes that the war in Ukraine will continue but not escalate further, although the further development of the war in Ukraine and its effects on economic growth are still subject to a high degree of uncertainty. In addition, we are assuming that an acute gas shortage with regulatory cuts in natural gas supply to energy-intensive industries in Europe will not materialize. We expect China’s departure from its zero-COVID strategy to have a positive impact on the development of demand.

The global economy is expected to grow by only 1.6% in 2023 (2022: 3.0%). We expect growth of 1.8% for global industrial production (2022: 2.5%), while global chemical production is likely to expand by 2.0% in 2023 (2022: 2.2%). Our planning assumes an average oil price of $90 for a barrel of Brent crude and an exchange rate of $1.05 per euro. We anticipate elevated and very volatile gas prices in Europe.

Sales, earnings and ROCE forecast for the BASF Group1

The BASF Group is expected to generate sales of between €84 billion and €87 billion in 2023. Planned volume growth in all segments will contribute here. We anticipate slight sales growth in the Agricultural Solutions and Materials segments, mainly driven by higher prices and volumes in both segments. Sales in Other should be slightly higher. We are forecasting sales at prior-year level in the Nutrition & Care segment. We anticipate lower price levels, especially for basic chemicals and precious metals, which will lead to a slight sales decrease in the Chemicals and Surface Technologies segments. The Industrial Solutions segment is also expected to see slightly lower sales due to the sale of the kaolin minerals business.

The BASF Group’s EBIT before special items is expected to decline to between €4.8 billion and €5.4 billion. Our planning for the Agricultural Solutions segment assumes a slight increase in EBIT before special items. In the Nutrition & Care, Surface Technologies and Industrial Solutions segments, we expect slightly lower EBIT before special items. We anticipate significantly lower contributions from the Chemicals and Materials segments and from Other. We expect a weak first half of 2023 followed by an improved earnings environment in the second half of the year due to recovery effects, especially in China.

Based on the weaker earnings performance and slightly higher cost of capital basis forecast for the BASF Group in 2023, we expect a ROCE of between 7.2% and 8.0%. ROCE should increase slightly in the Agricultural Solutions segment. In the Industrial Solutions and Surface Technologies segments, ROCE is likely to decline slightly. Compared with the previous year, we anticipate a considerable decrease in ROCE in the Chemicals, Materials and Nutrition & Care segments.


1 For sales, “slight” represents a change of 0.1%–5.0%, while “considerable” applies to changes of 5.1% and higher. “At prior-year level” indicates no change (+/–0.0%). For earnings, “slight” means a change of 0.1%–10.0%, while “considerable” is used for changes of 10.1% and higher. “At prior-year level” indicates no change (+/–0.0%). For ROCE, we define a change of 0.1 to 1.0 percentage points as “slight,” a change of more than 1.0 percentage points as “considerable” and no change (+/–0.0 percentage points) as “at prior-year level.”

CO2 emissions forecast for the BASF Group

CO2 emissions are expected to be between 18.1 million metric tons and 19.1 million metric tons in 2023. We anticipate additional emissions from moderate growth in production and slightly higher capacity utilization at emissions-intensive plants. For example, the ammonia plants in Europe will probably see higher capacity utilization compared with 2022 but will continue to run at low levels due to sustained high gas prices. We will counteract this increase with targeted measures to reduce emissions, further increase energy efficiency and optimize processes and, above all, continue the shift to electricity from renewable energies.


The material opportunities and risks that could affect our forecast are described in the BASF Report 2022.


This page contains forward-looking statements. These statements are based on current estimates and projections of the Board of Executive Directors and currently available information. Forward-looking statements are not guarantees of the future developments and results outlined therein. These are dependent on a number of factors; they involve various risks and uncertainties; and they are based on assumptions that may not prove to be accurate. Such risk factors include those discussed in Opportunities and Risks of the BASF Report 2022. BASF does not assume any obligation to update the forward-looking statements contained in this outlook above and beyond the legal requirements.

Last Update October 31, 2023