The shift is easiest to see from the coastline of Guangdong. While Europe’s chemical industry has spent years absorbing energy shocks, BASF has just officially opened a vast integrated site in Zhanjiang, in southern China, an investment the company puts at about €8.7 billion. What’s changing is not the chemistry but the geography: the growth market is China, and the biggest foreign chemical investor in the country has moved next to its customers.
The numbers behind the ribbon-cutting are industrial-scale. The Zhanjiang Verbund site spreads over around four square kilometers of coast, with 18 plants started up, 32 production lines running and a portfolio of more than 70 products, from basic chemicals to specialties, made by over 2000 people. It is BASF’s seventh Verbund site worldwide and now its third largest, behind only Ludwigshafen and Antwerp, and it runs entirely on renewable electricity. Most of what it makes stays in China, serving the transportation, consumer goods, electronics, home care and personal care sectors under the company’s local-for-local approach.
BASF chief executive Markus Kamieth framed the opening as a statement of intent: “Zhanjiang shows what the future of chemistry looks like: efficient, digital and sustainable by design.” He credited the team for delivering a project of this magnitude on time and under budget, and cast the commitment in strategic terms: “This investment shows confidence in the world’s largest chemical market in the long run and will be an important element of our ‘Winning Ways’ strategy.”
The bet was sized years ago, under his predecessor. In 2022, then-chief executive Martin Brudermueller defended the roughly $10 billion plan against criticism in Berlin, urging Germans to “step away from China-bashing and look at ourselves a bit self-critically,” and calling for a broader resilience strategy from the government. “Overall, we came to the conclusion that it is advantageous to expand our involvement”, he said of China, adding at the site’s first-plant inauguration that “We benefit from China’s policies of widening market access,” That first plant, opened in September 2022, makes 60,000 metric tons of engineering plastics a year, aimed squarely at China’s car and electronics industries, with the whole complex slated for completion in 2030 as what BASF then called a “role model of sustainable production both in China and globally,” a label the finished site is now meant to earn.
The trend underneath is a hedge as much as a bet. The same 2022 results that Brudermueller presented showed why China mattered: group sales rose 15.6 percent to 68 billion euros, but third-quarter earnings slumped 29 percent on high energy and raw material costs, while China sales climbed 5.8 percent to 9.2 billion euros. The renewable-power target, 100 percent by 2025, has since been met in full. Watch this space: the site that began as a contrarian wager opens as the industry’s clearest test of whether being closest to the customer, at scale and on clean power, pays for the chemistry of the next decade.
