Basf SE BAS

BASF's Global Presence Partially Insulates It From Regional Volatility

BASF is the world’s largest chemical producer by volume. Of its six reportable segments, four represent the company’s core businesses and rely on its Verbund strategy. That strategy seeks to produce chemicals at the lowest cost possible through power savings and by recycling reaction byproducts into downstream production. Still, as a Europe-based producer, BASF faces higher feedstock costs relative to US producers. We don’t believe that the savings it gains from Verbund fully offset its higher raw material costs.