The transcript records the Q&A session from BASF’s 2019 Capital Markets Day in Ghent, focusing on the Agricultural Solutions division. Executives—including Saori Dubourg (Board Member), Vincent Gros (President Agricultural Solutions), and Dr. Peter Eckes (President Bioscience Research)—respond to analyst questions about growth drivers, product pipelines, digital agriculture, regulatory environment, and integration of Bayer assets. Key points include: • Revysol as a blockbuster product and a major sales contributor. • Growth strategy based on organic market‑share gains, especially in fungicides, insecticides, hybrid wheat, soy traits, and new active ingredients. • Digital platform xarvio, its pricing (per‑hectare service fees and app subscriptions), and the shift toward immediate revenue generation. • Genome‑editing research is limited to discovery due to EU regulatory bans on edited products. • Sustainability and regulatory risk management, with emphasis on multi‑gene traits to mitigate resistance. • Margin improvement targets (500‑600 bps) tied to cost synergies, R&D focus, and cross‑selling with Bayer‑derived assets. • Emphasis on farmer profitability, demand creation, and partnerships (e.g., with Nutrien, machinery firms) to secure market leadership. The executives convey a cautiously optimistic outlook, stressing focused R&D, digital integration, and regulatory‑driven innovation as levers for out‑performing market growth.
Topics
Revysol as a Blockbuster Revenue Engine
Discussion of Revysol’s outsized contribution to the €6 bn peak sales target and its role as a flagship product in the portfolio.
Organic Market‑Share Growth vs. M&A
Executive emphasis that the projected 1 % absolute growth above market is driven entirely by organic expansion, not acquisitions.
Digital Agriculture Platform xarvio – Business Model Shift
Explanation of xarvio’s revenue streams (app fees, per‑hectare service contracts, direct farmer invoicing) and the strategic pivot to generate cash now rather than waiting for data‑generation benefits.
Pricing Strategy for Digital Services and Field Guarantees
Details on per‑hectare pricing (e.g., €250/ha for disease‑free field guarantee) and the dual revenue model of services plus product sales.
Genome Editing – Discovery Only, EU Regulatory Block
Clarification that BASF uses CRISPR for trait discovery (e.g., wheat) but will not commercialize edited products in the EU due to court rulings.
Growth Levers: Hybrid Wheat, Insecticide Actives, Soy Traits
Outline of three primary pipeline drivers—new hybrid wheat technology, low‑share insecticide actives, and profitable soy traits—each positioned as blue‑ocean, incremental revenue sources.
Sustainability‑Embedded R&D and Resistance Management
Approach to designing multi‑gene, multi‑mode‑of‑action traits to delay resistance, and embedding sustainability criteria to lower regulatory risk.
Regulatory Landscape and Its Impact on Portfolio
Discussion of increasing regulatory scrutiny (e.g., fungicide bans, EU genome‑editing rulings) and BASF’s proactive trend‑analysis and stakeholder dialogue to mitigate risk.