How has BASF performed in South America over the past two years?

We experienced a record year for BASF in South America in 2019, performing well in all 11 businesses we have in the region. The acquisition of assets to the BASF portfolio in 2018 supported the growth. After the new government was elected in Brazil, there was a noticeable positive sentiment because of the reform agenda and action plan that had been set. This environment determined a robust outlook for BASF’s investments in the country, including the recently built acrylics complex in Camaçari, Bahia.

2020 started well for BASF in the region, despite difficult economic conditions in Brazil. However, from late March onwards, there was an overall significant downturn due to COVID-19, particularly for our businesses that cater to the automotive industry, including OEM paints, plastics and additives. This said, some businesses, such as home care, animal nutrition or health experienced an even higher demand. A number of BASF’s 15 plants in South America reduced production, some partially and others completely. While Q2 was a weaker quarter, Q3 has seen a soft demand pickup. As a consequence, our impacted plants are gradually returning to higher levels of production. Our Agricultural Solutions division has remained strong throughout the year despite headwinds from currency devaluations, particularly the Brazilian real and the Argentinean peso.

Can you elaborate on BASF’s digital farming platform, Xarvio, and the joint venture with Bosch for smart planting?

Xarvio is the platform which helps field management. You are able to analyze and identify via drones where infected areas and then formulate and apply products taking into account factors such as field geology, disease pressure and water content. Xarvio is at the forefront of the digital transformation of agriculture optimizing crop production. It offers digital products based on a global leading crop model platform, which delivers independent field-zone-specific agronomic advice enabling farmers to produce their crops most efficiently and sustainable.

Meanwhile, BASF´s JV with Bosch combines Bosch’s smart spraying concept and the Xarvio field manager. Bosch and Xarvio Digital Farming Solutions are intensifying their collaboration in the development of digital farming solutions. The goal of the collaboration is to develop an intelligent system for demand-based application of fertilizer and intelligent placement of seeds.

How does BASF leverage its global network to design new products for the agriculture market?

In the past, BASF mainly provided solutions for crop protection. At the turn of the century, BASF was very strong in Europe, particularly in fungicides. Since the acquisition of American Cyanamide in 2000, BASF became a strong player in North America, particularly in herbicides and insecticides. Over time we were able to combine these strengths and leverage - together with a number of further acquisitions, the latest being the acquisition of seeds assets - the knowledge and our global R&D network to provide new products to the agricultural markets. BASF’s research centers in Brazil are a key part of the company’s global research network, which enables cross-fertilization of knowledge and innovation.

What trends have you noticed in the nutrition and care industries, and where is the demand coming from?

Speaking to some of our major Personal Care clients, such as Boticário and Natura, the topic of sustainability and vegan natural products are rapidly growing trends to which we are fully aligned. In nutrition, there is a significant increase in the consumption of vitamins and enriched foods.

Another trend across all industries is the move towards digitalization. Even before the pandemic, BASF had been utilizing digital platforms to be able to distribute chemical products to small and medium sized clients, and COVID-19 has accelerated this development.

What initiatives is BASF taking to support the move toward a circular economy?

Although BASF is not a producer of single-use plastics, we were one of the co-founders of the Alliance to End Plastic Waste (AEPW), which has committed over US$1 billion with the goal of investing US$1.5 billion over five years to help end plastic waste in the environment. New solutions will be developed and brought to scale that will minimize and manage plastic waste.

This also includes the promotion of solutions for used plastics by helping to enable a circular economy. One important measure to end uncontrolled entry of plastics into the environment is to build up closed circles where plastic can be used as new raw material. The chemical industry plays an important role in innovating and implementing large-scale processes to convert plastic waste into new products.

In my view a benchmark of the circular economy initiatives is Campo Limpo in Brazil, which was driven by the agricultural industry to deal with the plastic containers used to transport herbicides and fungicides to the growers. In the past, the empty containers after application of the product were often left in the field, potentially causing contamination. Therefore, the industry participated in the design of sensible regulations and developed a system to make all players in the value chain part of the solution. The effectiveness of this program is now over 90% and it is a fantastic example of how we can create a sustainable, circular economy.