Outlook 2025

Quarterly Statement Q3 2025

Global gross domestic product (GDP) grew in the third quarter of 2025 by around 2.6% compared with the prior-year period, according to current estimates.

In the European Union, third-quarter economic activity barely picked up compared with the preceding quarter. Estimated GDP growth of 1.2% compared with the prior-year quarter was significantly below the global average. In Germany, the data available so far show a considerable decline in industrial production, suggesting another weak quarter for German GDP. The economy was presumably flat compared with the second quarter and barely grew versus one year earlier. In France and Italy, the growth rates were only minimally higher at around 0.5%. By contrast, Spain likely saw significantly stronger GDP growth of 3%. In the United States, economic growth remained relatively high. Contributing factors here included positive impetus from foreign trade and stable consumer spending. According to current estimates, the third-quarter growth of around 2% was only slightly below the levels of the preceding quarters. However, the approximately 1% increase in industrial production was considerably weaker. In China, GDP growth in the third quarter slowed slightly to 4.8%. Once again, industrial production proved to be the economic driver. Growth in domestic demand for goods was weaker overall compared to production. Increasing exports of goods contributed to growth, despite rising tariffs in trade with the United States.

Based on preliminary data and estimates, global industrial production grew by around 2% in the third quarter compared with the previous year. The trends varied by region: In the E.U., manufacturing output increased by around 1.5%, driven in part by double-digit growth in the pharma industry. In the United States, production in the manufacturing sector also expanded by slightly more than 1%. Production growth was significantly higher in the Asia Pacific region’s major emerging markets: Manufacturing activity grew by around 6% in China and around 5% in India. By contrast, production in Japan was only stable. The automotive industry recorded a moderate rise in output: According to current estimates, vehicle production in the third quarter of 2025 was up by 0.9 million units compared with the previous third quarter; this equates to an increase of around 4.4%, primarily seen in the Asia Pacific region. In the consumer goods market, demand for durable goods remained weak, with production decreasing in the furniture industry in particular. Food manufacturing grew moderately. According to current estimates, overall production of personal care products contracted. Output in the E.U. construction industry expanded slightly, according to official figures, but this growth came only from infrastructure projects. In the United States, on the other hand, there was a significant fall in real construction spending and the number of houses under construction. Building activity also continued to decline in China. The picture in the agriculture sector was still mixed: While customers in Europe and North America were holding lower inventories, the decline in agricultural prices and the trade policy uncertainty had a dampening effect on demand. In the United States in particular, farmers felt the adverse economic impacts of declining exports to China.

Global chemical production expanded by around 4% in the third quarter of 2025 compared with the previous year. With growth of nearly 8%, China was driver of global production, whereas production outside of China decreased slightly. Chemical production in the E.U. is estimated to have declined by around 3%, while in Germany it was 5% below the level of the prior-year quarter. U.S. chemical production, on the other hand, rose slightly by around 1%.

The oil price in the third quarter averaged $69 per barrel (Brent crude), below the level of the prior-year quarter ($80 per barrel). Owing to expanded production and only sluggish demand growth, a downward price trend for oil was seen in the quarter. The fluctuation range was relatively small, with daily prices between $65 and $74 per barrel.

Given the major uncertainties relating to future economic development, BASF maintains its previous assumptions regarding the global economic environment in 2025 unchanged as follows:

• Growth in gross domestic product: 2.0% to 2.5%
• Growth in industrial production: 1.8% to 2.3%
• Growth in chemical production: 2.5% to 3.0%
• Average euro/dollar exchange rate of $1.15 per euro
• Average annual oil price (Brent crude) of $70 per barrel

As a result of the changes in the presentation of the BASF business units OEM automotive coatings, automotive refinish coatings and surface treatment, we have made a technical adjustment to the full year 2025 forecasts for the BASF Group as published in the BASF Half-Year Financial Report 2025 (previous forecast from the BASF Half-Year Financial Report 2025 in parentheses, if changed):

• EBITDA before special items of between €6.7 billion and €7.1 billion (€7.3 billion and €7.7 billion)
• Free cash flow of between €0.4 billion and €0.8 billion
• CO₂ emissions of between 16.7 million metric tons and 17.7 million metric tons

The risks of a price-related margin decrease cited in the BASF Report 2024 partially materialized and led to a slight earnings decline in the first three quarters of 2025. For the fourth quarter of 2025, there are risks relating to a steeper reduction in prices, rising feedstock prices and lower-than-expected volume growth. Opportunities may arise from a positive development in demand and margins. Our global strategy to serve customers from regional production facilities helps to minimize direct tariff impact. Indirect effects can result from, among other things, growing competitive pressure, declining demand, planning uncertainty and supply chain risks. The resulting effects still cannot be fully assessed.

The statements relating to opportunities and risks contained in the BASF Report 2024 with regard to further risk factors are generally still valid. 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.

BASF Report 2024

Our forecast for the BASF Group and segments for 2025 is based on the assumption that a moderate recovery in demand for goods will support the growth in gross domestic product and industrial production. In particular, the decline in consumer price inflation and the associated increase in real incomes are expected to boost consumer purchasing power in the United States and Europe. However, challenges such as increasing geopolitical uncertainty and a further escalation of trade conflicts in particular, will weigh on business and consumer confidence. Following the decline in automotive production in 2024, we expect stagnation in 2025. For the global chemical industry, we anticipate slightly higher growth compared with expectations for gross domestic product and industrial production. Growth in the chemical industry should result primarily from the anticipated expansion of the sector in China and other emerging Asian markets. We anticipate an average oil price of $75 for a barrel of Brent crude and an exchange rate of $1.05 per euro.

In 2025, the BASF Group’s EBITDA before special items is expected to increase to between €8.0 billion and €8.4 billion (2024: €7.9 billion). The Materials, Nutrition & Care, Industrial Solutions² and Surface Technologies segments² are likely to contribute to this. For some, this may be primarily attributable to sales volume growth and, in some cases, also to higher margins. In the standalone business Agricultural Solutions, we forecast slightly higher volume-related earnings. EBITDA before special items for the Chemicals segment is expected to decrease slightly compared with 2024. In particular, earnings in the Petrochemicals division will be impacted by rising fixed costs in connection with the startup of the new Verbund site in China and scheduled turnarounds. The anticipated considerable earnings growth in the Intermediates division will only be able to partially offset this.

We forecast the BASF Group’s free cash flow to be between €0.4 billion and €0.8 billion (2024: €0.7 billion). This is based on expected cash flows from operating activities of between €5.6 billion and €6.0 billion, minus expected payments made for property, plant and equipment and intangible assets in the amount of €5.2 billion.

CO₂ emissions forecast for the BASF Group

CO₂ emissions are expected to be between 16.7 million metric tons and 17.7 million metric tons in 2025 (2024: 17.0 million metric tons). We anticipate additional emissions compared with the previous year from higher forecast production volumes based on rising demand. We will counteract this increase with targeted measures to reduce emissions, such as increasing energy efficiency and optimizing processes as well as continuing the shift to electricity from renewable energies through the shareholding in the Hollandse Kust Zuid offshore wind farm, for example.

¹ For EBITDA before special items and free cash flow, “slight” represents a change of 0.1% to 10.0%, while “considerable” applies to changes of 10.1% and higher. “At prior-year level” indicates no change (+/-0.0%).
² The assumptions for the Industrial Solutions and Surface Technologies segments already take into account the reclassification of the chemical and refining catalysts business as of January 1, 2025, and are based on correspondingly adjusted figures for 2024.

Disclaimer

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. BASF does not assume any obligation to update the forward-looking statements contained in this presentation above and beyond the legal requirements.