BASF : Kepler Cheuvreux, CIBC, Macquarie Global Agriculture Forum

Agricultural Solutions

Rolf Reinecke

Senior Vice President

Global Strategic Marketing Agricultural Solutions

Global Agriculture Forum - Kepler Cheuvreux

November 16, 2020

Cautionary note regarding forward-looking statements

This presentation 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 on pages 139 to 147 of the BASF Report 2019. BASF does not assume any obligation to update the forward-looking statements contained in this presentation above and beyond the legal requirements.

2 November 16, 2020 | BASF Agricultural Solutions

BASF Group Q3 2020: While volumes declined slightly overall, Agricultural Solutions increased sales volumes considerably

Sales volumes development by segment

Q3 2020 vs. Q3 2019

absolute (million €) terms

	Chemicals	Materials	Industrial	Surface	Nutrition	Agricultural	Other
BASF
Group	(259)	(125)	Solutions	Technologies	& Care	Solutions	(128)
(347)			(104)	95	(5)	179

 (2%)

relative (%) terms



(11%)



(4%)



(5%)

 3%	0%		 11%



(19%)

3 November 16, 2020 | BASF Agricultural Solutions

Agricultural Solutions Q1-Q3 2020: Slight increase in sales and EBIT before special items compared with Q1-Q3 2019

Sales Q1-Q3 2020 vs. Q1-Q3 2019	EBIT before special items
million €		million €
	6,006	6,059
6,000				955
1%	1,000	934		2%

4,000

500

2,000

0						0
	Q1-Q3 2019		Q1-Q3 2020		Q1-Q3 2019		Q1-Q3 2020

Sales development		Volumes		Prices		Portfolio
Q1-Q3	2020 vs.		 7%	0%	0%
Q1-Q3	2019

Currencies

	(6%)

4 November 16, 2020 | BASF Agricultural Solutions

Agricultural Solutions division contributes strongly to achieving BASF Group's targets

BASF targets

Grow sales volumes	Increase EBITDA	Achieve a return
on capital employed
faster than global	before special	(ROCE) considerably
chemical production	items by 3% to 5%	above the cost of
every year	per year	capital percentage
		every year

Contribution of Agricultural Solutions

Achieve €22 billion in Accelerator sales by 2025

Grow

CO2-neutrally

until 2030

• Grow one percentage point above market to increase market share
• Increase sales by 50% by 2030

• Grow EBITDA before special items by on average 5% per year
• Restore EBITDA before special items margin level of ~23% within next years with high R&D intensity

• ROCE currently impacted by asset step up after acquisition
• Restore ROCE above the cost of capital percentage

• R&D pipeline with peak sales potential of >€7.5 billion1
• Accelerators account for approximately half of the R&D pipeline

• CO2-optimized production processes
• Offer solutions to reduce CO2-emissions in agricultural production

5	November 16, 2020 | BASF Agricultural Solutions 1 The innovation pipeline comprises products with a launch date between 2019 and 2029.

BASF differentiates versus peers with four strategic levers

Innovation

Digital

Sustainability

Customer experience

6 November 16, 2020 | BASF Agricultural Solutions

BASF differentiates versus peers with four strategic levers

Innovation

Digital

Sustainability

Customer experience

7 November 16, 2020 | BASF Agricultural Solutions

BASF is fully enabled to offer innovative solutions with strong brands in all indications and sectors1

Seeds & traits	Seed treatment	Crop protection				Digital farming
		Standak® Top		Revysol®	Kixor®
				Finale®
				Basta®	Nealta®
				Liberty®	F500®	Xemium®
		Nodulator® PRO		Inscalis®

Initium® Engenia®

LibertyLink®

Fungicides Herbicides Insecticides

8	November 16, 2020 | BASF Agricultural Solutions 1 Representative selection of brands and active ingredients

We develop solutions that benefit farmers and the environment

Revysol®	Broflanilide
fungicide	insecticide1

Best foundation for farmer income and optimized farm management

• Already designed in discovery phase to achieve superior performance and satisfy the highest approval standards
• Registration of Revysol® achieved in record time in all four regions without classification due to favorable regulatory profile
• Outstanding biological performance against a range of difficult to control pathogens in a multitude of crops
• Strongly supports sustainable farming through increased productivity using less resources and manage resistances

Innovative insecticide active ingredient with a novel mode of action

• Powerful, versatile and long-lasting insecticide to control tough chewing insect pests on a broad range of crops
• First registrations received in Australia and Canada; further product registrations anticipated
• Seed treatment applications based on Broflanilide, marketed under the Teraxxa™ brand in North America targeting difficult to manage wireworms in cereal crops
• Excellent new tool for resistance management with no known cross- resistance

9	November 16, 2020 | BASF Agricultural Solutions 1 Co-developed with Mitsui Chemicals Agro, Inc

Acquired businesses and further actions strengthen our herbicide business

Innovative, connected technologies for integrated and sustainable weed management

Connected offer

Selective chemistry

Digital	Non-selective
chemistry

Further actions in implementation

	► Glufosinate-ammonium asset optimization
Non-	► L-Glufosinate acquisition from Agrimetis®
selective
chemistry ► Investment in differentiated and improved
	product offers

SustainabilitySeeds

HT Traits

	► Engenia® registration in the U.S.
Selective	for 5 years
chemistry	► Luximo® and Tirexor® launches in Australia,
	in further countries over the next years

10 November 16, 2020 | BASF Agricultural Solutions

Acquisition of innovative melon breeding company ASL

Securing and growing BASF's position in melon seeds

 Consistently delivering innovations, adding

differentiated varieties that create value

 Speeding up development of differentiating consumer-oriented traits by combining strengths of ASL's and BASF's programs

 Backward integration to strengthen innovation pipeline of BASF's vegetable seeds business

 New seed and breeding production location for Southern Europe

11 November 16, 2020 | BASF Agricultural Solutions

BASF differentiates versus peers with four strategic levers

Innovation

Digital

Sustainability

Customer experience

12 November 16, 2020 | BASF Agricultural Solutions

Investments in digital products support growth and market access in crop protection and seeds, new income streams to be established

Smartening crop protection and seeds	Enhanced digital market access	New digital business models
 Digitally enabled product launches		Establish data relationships with	 xarvio™ SCOUTING
	Stewardship (e.g., Engenia® tool)		growers and channel partners		xarvio™ FIELD MANAGER
	Digitally enabled sales force		3.6 million users today in >100 countries		xarvio™ HEALTHY FIELDS

13 November 16, 2020 | BASF Agricultural Solutions

Multi-pronged approach to push digitalization across the segment

BOSCH BASF Smart	Accelerate	xarvio™
Farming GmbH1	R&D process	HEALTHY FIELDS

Joint venture offering smart farming solutions from Q1 20212

• Hard- and software in customized bundles
• First products to be launched in Brazil, followed by Europe and North America
• Smart spraying to reduce the use of herbicides by up to 70%

Collaboration with Tecnalia

• Image recognition technology to determine efficiency
• Stronger focus on promising, innovative active ingredients
• Faster development of innovation

Outcome-based business model

• Tailored field and season-specific crop protection strategy
• Guarantees plant health and enables to achieve agreed yield forecast
• Agrow Crop Science Award 2020 for "Best Innovation in Digital Farming Technology"

14	1	Foundation of the company planned by Q1 2021
November 16, 2020 | BASF Agricultural Solutions 2	The foundation of the joint venture is subject to the approval of the relevant antitrust authorities.

BASF differentiates versus peers with four strategic levers

Innovation

Digital

Sustainability

Customer experience

15 November 16, 2020 | BASF Agricultural Solutions

Our sustainability commitments as a leader in agriculture

Climate Smart Farming

Sustainable Solutions

Digital Farming

Smart Stewardship

Supporting farmers to become	Steering our portfolio	Helping farmers to grow	Striving for
more carbon efficient	systematically	profitably and reduce their	zero farming incidents
and resilient to volatile	to increase the share	environmental footprint	that impact human health
weather conditions	of sustainable solutions we		and the environment
	bring to farmers year by year

16 November 16, 2020 | BASF Agricultural Solutions

Climate Smart Farming

Some examples

Improving the health of farm soil

• Healthy soil is the foundation of a healthy farm ecosystem
• Our herbicides allow for minimum tillage with up to 10% fewer CO2 emissions per ton of crop produced
• Minimizing erosion and increasing soil organic matter

Enhancing yield and climate resilience through innovation

• High-yieldingand stress-resistant varieties will reduce environmental impact and increase on-farm profitability in challenging farming environments
• Hybrid wheat varieties for significant yield increase and improved grain quality

Keeping nitrogen on target

• Improving fertilizer efficiency with nitrification and urease inhibitors
• More nitrogen available to crops for longer
• Higher yield, fewer greenhouse gas emissions and better environmental footprint: our nitrogen use efficiency solutions will reduce up to 30% CO2 emissions per ton of crop

17 November 16, 2020 | BASF Agricultural Solutions

BASF differentiates versus peers with four strategic levers

Innovation

Digital

Sustainability

Customer experience

18 November 16, 2020 | BASF Agricultural Solutions

We want to strengthen customers' experience even further based on listening, dialog, respect and mutual trust

Deepen customer				Improve
understanding				customer experience

Increase customer		Enhance data
coverage		management

Evolve offerings

19 November 16, 2020 | BASF Agricultural Solutions

Seeds Crop Digital

protection