to China. That is why our free cash flow decreased by EUR 368 million compared with Q4 2022, but still reached EUR 2.2 billion. Let's now turn to our balance sheet at the end of December 2023, compared with year-end 2022. Total assets declined by EUR 7.1 billion and amounted to EUR 77.4 billion, mainly due to our strong focus on cash management and working capital management, in particular. The decline was driven by lower current assets, largely on account of reduced inventories, lower other receivables and miscellaneous assets, and lower trade accounts receivables. Overall, current assets were reduced by EUR 6 billion. Non-current assets declined by EUR 1.1 billion.
As of December 31, 2023, net debt was almost stable and amounted to EUR 16.6 billion, compared with EUR 16.3 billion at year-end 2022. I will now give you further insights into capital expenditures. BASF's corporate strategy is based on organic growth. Therefore, CapEx and R&D expenses are the foundation for our future business. However, we are responding flexibly to the changes in the market environment. We continue to be confronted with a significant imbalance in supply and demand in several value chains, structurally higher energy prices in Europe, and overall subdued market demand. We will therefore further strengthen our focus on capital discipline across the entire portfolio.
For the BASF group, we plan capital expenditures of EUR 19.5 billion between 2024 and 2027, of which EUR 6.8 billion relate to our growth projects, the new Verbund site in Zhanjiang, China, and the expansion of the Battery Materials business. The total CapEx for this current planning period compares with EUR 24.5 billion for the prior planning period from 2023 to 2026. You will have noticed that we shortened our CapEx planning period from five to four years, mainly because forecast accuracy is higher in the slightly shorter timeframe. In 2024, we plan total capital expenditures of EUR 6.2 billion, compared with EUR 5.2 billion in 2023. Thereof, spending of EUR 3.3 billion on property, plant, and equipment is related to our growth projects in 2024.
The CapEx peak for these growth projects is expected this year, so investments will decrease again in the following years. As communicated during our investor update in December 2023, we will postpone non-critical projects in line with market demand. We are also tightening our belts somewhat with regard to our growth projects. At our Verbund site in China, we will further leverage the favorable procurement environment. In our Battery Materials business, we will use flexibility in the scheduling and sequence of the investments and will also evaluate partnerships to optimize CapEx. Between 2024 and 2027, we are planning investments totaling around EUR 900 million in our transformation towards net zero. In BASF's net zero transformation, we will maintain the overall investment scope with a clear focus on CO2 reduction, renewables, and recycling.
We will fund certain investments, such as wind farms, via project financing, which will require significantly less CapEx. In addition, we will strike the right balance between power purchase agreements and own investments in the production of green electricity. Now, I would like to provide our view on the transaction between Harbour Energy plc and Wintershall Dea. As you know, on December 21, 2023, BASF, LetterOne, and Harbour signed a business combination agreement to transfer most of Wintershall Dea's E&P business to Harbour, namely the entire non-Russia-related E&P business. In exchange, at closing, BASF will receive a cash consideration of $1.56 billion and a share in the enlarged Harbour of 39.6% of the entire shares.
Following the completion of the transaction and a six-month lock-up period, BASF will have the opportunity to gradually monetize its stake in Harbour as the company is listed on the London Stock Exchange. The agreed enterprise value for the Wintershall Dea assets amounts to $11.2 billion. This amount includes the outstanding bonds of Wintershall Dea, with a nominal value of around $4.9 billion, that will be transferred to Harbour at closing. There is an upside potential through a higher market valuation of the enlarged Harbour after closing. The transaction provides an attractive stepwise exit from the oil and gas business, in line with BASF's financial and strategic requirements. However, we are not setting ourselves a specific deadline for selling all of our shares in Harbour.
Let me also explain in some more detail what will happen with the assets that are not part of the transaction. Wintershall Dea, as the remaining company, will hold all Russia-related assets. The purpose of the company will be to divest or liquidate the various Russia-related participations, to manage the claims associated with the Russia-related activities of Wintershall Dea, to rightsize its organization following the completion of the transaction with Harbour, and to provide transitional services to Harbour if requested.... Furthermore, Wintershall Dea is continuing its preparations for a separate sale of its 50.02% stake in WIGA Transport Beteiligungs-GmbH & Co. KG, which is not part of the transaction with Harbour. The German federal government, which already holds the remaining shares in this company, WIGA, via SEFE, is our first point of contact here.
Since there has been quite some speculation in the German media, let me comment on four main topics that have been voiced as a concern. First, regulatory approvals. The review of the transaction by the relevant governmental bodies is in line with the standard procedure that the contracting parties initiate by submitting the corresponding applications. As stated in the BASF news release on December 21, 2023, the transaction with Harbour is subject to various regulatory approvals in several countries. In Germany, approval for foreign direct investments will also be required in accordance with the Foreign Trade and Payments Ordinance. We are confident that we will receive clearances in all cases. Completion of the transaction is targeted for the fourth quarter of 2024. Second, Germany's energy supply security.
Wintershall Dea's oil and gas production in Germany accounts for roughly 1% of German oil and gas consumption. In terms of securing Germany's energy supply, it is not decisive whether the E&P activities currently managed by Wintershall Dea are operated by a German or British company in the future. Third, CCS technology. The focus of Wintershall Dea is limited to the development of reservoirs for the permanent storage of CO2. The activity is operated by a quite small international team, currently out of Norway, the Netherlands, and Germany. The acquired licenses are all outside of Germany, namely in Denmark, Norway, and the U.K. Wintershall Dea is not involved in CO2 capture and does not consider CO2 transportation as a core business.
BASF, on the other hand, is a leader in the technology for capturing CO2 emissions as part of its global gas treatment business, which we are continuously developing. Our OASE technologies are available globally, also in Germany. You might, however, be surprised to learn that geological CO2 storage in Germany, whether onshore or offshore, is still not allowed under the existing German legal framework. And fourth, the closure of the German headquarters of Wintershall Dea. The timing of the announcement was unfortunate, but unavoidable for legal reasons, resulting from the fact that BASF and Harbour are both publicly listed companies. Wintershall Dea has state-of-the-art expertise in the oil and gas business. Therefore, all employees of the operating companies included in the transaction, around 1,200 employees, will be taken on by Harbour.
Harbour also intends to provide offers to some employees from the current headquarters to join the combined company. The details will be agreed in the currently ongoing review prior to completion of the transaction. I hope this helps to put things into perspective. Until closing, Wintershall Dea and Harbour will continue to operate as independent companies and are preparing closing and the integration to the extent possible under the applicable legal framework conditions. With that, back to you, Martin.
Thank you, Dirk. Ladies and gentlemen, as I have frequently mentioned, an attractive dividend is an important target for the BASF board. This also holds true in challenging times. Therefore, we stick to our practice to increasing the dividend per share each year or keeping it stable. We will thus propose a dividend of EUR 3.40 per share to the annual shareholders meeting. Based on the year's end share price, this offers a higher dividend yield of 7%. In total, we will pay out EUR 3.0 billion to our shareholders. This amount is largely covered by the free cash flow of EUR 2.7 billion generated in 2023. Our strong balance sheet, high equity ratio, and good credit ratings give us the necessary financial strength with regard to paying an attractive dividend. Now, I will conclude with the outlook.
We expect that the weakness in global economic momentum from 2023 to continue in 2024. The main reason for this will be the expected persistently high interest rates, which will continue to dampen growth in the U.S. and in Europe. We expect the demand for industrial goods will normalize only gradually, and that the share of goods in the private consumptions will rise only slowly. For this reason, we only expect very moderate growth in most of our customer industries. Recovery in China remains uncertain, particularly with regard to the real estate sector and the further development of the labor market. We do not expect any significant growth stimulus in the EU. We anticipate a gradual slowdown in the U.S. due to, among other things, high interest rates.
The geopolitical situation remains critical against the backdrop of the wars in Ukraine and the Middle East and other geopolitical tensions, particularly between the United States and China. Global chemical production is nevertheless expected to grow faster in 2024 by 2.7%, compared with 1.7% in 2023.... This will be driven primarily by the expected growth in the Chinese chemical industry. Our planning assumptions on average oil price of $80 per barrel of Brent crude and exchange rates of $1.10 per euro. Based on these assumptions, the BASF Group's EBITDA before special items is expected to rise to between EUR 8.0 billion and EUR 8.6 billion in 2024. Volume and margin growth in all segments will contribute here.
Higher fixed costs due to inflation, but also in connection with the construction of our new Verbund site in China, will burden earnings. We forecast the BASF Group free cash flow to be between EUR 0.1 billion and EUR 0.6 billion. This is based on expected cash flows from operating activities of between EUR 6.6 billion and EUR 7.1 billion, minus expected payments made for intangible assets and property, plant and equipment in the amount of EUR 6.5 billion. The high investment-related cash flow is mainly due to investments in the new Verbund site in China. In the context of our free cash flow forecast, please be reminded that BASF's cash flow is typically weak in Q1 and strengthens in the further course of the year. This is mainly due to the seasonality of our Agricultural Solutions business.
CO2 emissions are expected to be between 16.7 million and 17.7 million metric tons in 2024. We anticipate additional emissions compared with the previous year from higher production volumes based on rising demand. We will counteract this increase with targeted emission reduction measures. Thank you, and now Dirk and I am glad to take your questions.
Ladies and gentlemen, I would like to open the call for your questions. If you wish to ask a question, please press the star key followed by one on your touchtone telephone. For the best sound quality, we kindly ask you to be sure to unmute your phone and use your headset when asking your questions. Given that the speech was a bit longer today, please limit your questions to only two at a time so that everybody has a chance to ask their questions. We will begin with Sam Perry from UBS. Please go ahead. He will be followed then by Christian Faitz and then Matthew Yates. Now Sam Perry, please.
Hi there. Thanks for taking my questions. A technical question on Wintershall Dea. Do you expect to receive the full cash proceeds at closing, so the $1.56 billion, or is there a delay to the receipt of any of this cash based on the business performance? And related to this, do you expect to receive a dividend from Wintershall this year while the process is ongoing? And then secondly, previously, Chinese imports into Europe have been cited as a big disruptive issue for demand. Have you seen any signs that that's coming off at all, given demand picking up domestically and also shorter term, the issues in the Red Sea? Thank you.
Yeah, Sam, this is Dirk speaking, I take the first question. So we are currently expecting the full cash proceeds of $1.56 billion to be received upon closing. Closing, we expect, as said, in the fourth quarter. Wintershall Dea will not pay to the shareholders a common dividend this year. So last year we received a dividend, our share EUR 290 million. This will not be the case this year. So full cash proceeds, yes. Dividend, no.
Sam, from my side on the Chinese imports, we see imports from China coming in, in an order of magnitude like never before. Very clearly there's capacity coming up in many product lines in China. Over capacities for the domestic market and the market there is also sluggish, so they also take every opportunity for exporting and making every ton somewhere in the world. That's particularly true also for the other Asian markets, but also South America, but also coming into Europe, and they take certain advantage from the high energy cost and their competitiveness they have. You mentioned the Houthi rebels disturbing the supply chain. Yes, there are effects. I think they are temporary.
I mean, there are some products where we actually see now that this inflow of Chinese volumes are interrupted, which then brings the customers in Europe, to rethink their supply strategies and also go back to European, ones to be more resilient. But I think this is a temporary effect. I mean, overall, it is a question of competitiveness of Europe in the long run, compared with, with China. So but that is a very broad activity. We see Chinese materials flowing in a lot of product lines.
Thank you very much.
Okay, so now it's Christian Faitz, Kepler Cheuvreux.
Yes, thank you, Stefanie. Good morning, everyone. I believe BASF considers itself the globally biggest automotive supplier still. Hence, what's your view on general automotive demand globally this year? Any regional differences you are observing? And then my second question would be, on agrochemicals. We hear left and right from industry sources and your peers that the channels are full into 2024. I'm missing any of that in your statement. Is that not what you're seeing as prominent number three player globally? And then, finally, to Martin. I believe this is one of your last official appearances in front of the aggregated analyst, investor community, as typically, the Q1 call on the day of the AGM is done by your CFO.
Hence, thank you very much for all the good discussions over the past several years, in fact, decades, and all the best for the future. I know it's tough, but try to enjoy the after BASF life.
... So, Christian, thank you very much for that very nice words. I still intend to be somehow heard in the Q1 call, but, yeah, there could be things that is not going to happen. But, thank you very much for the comment. I can only give that back to all you guys. It was always very enjoyable for me to interact with you, but it's not my farewell now. A very quick one on the automotive industry. I mean, very clearly, in 2023, automotive industry helped globally because it was one of the healthy sectors that actually had quite a strong increase in production. That is not foreseen for 2024.
Actually, if you look on the global expectations, then this is thought to be more, let's say flat, basically stagnating at the level of around 90 million units. And I would say January was much stronger than that, actually, a double digit volume growth here, if you look at the numbers and, China actually with an increase in January of 46% of its production. But I think this is not really an indicator for the overall year. So we expect this to get slower. But, as you know, Chinese domestic sales for cars is actually flat for many years now. So you see also here the Chinese cars and the increase in production in China is actually flowing out into the world.
That's a new focus area of the Chinese automotive industry, and let's be seeing how successful they are and what the impacts are on the production in the other regions. Very hard to predict, but I would say from a global perspective, automotive industry should be rather flat this year.
Christian, I take your question on ag. So first of all, we expect another good year from our agricultural division. Fundamental demand of the farmers is seen. The start into the year will be weaker than last year. And indeed, what you quoted is right. Also, we see a channel inventory, we see a pressure on the prices, and we see the de-stocking on the distributor level. So what is happening there, it seems that distributor are not taking the long shot, but rather wait a little bit longer, and are buying according to season. We have to bear in mind there are also higher financing costs out there now. So we see a little bit of a shift from Q1 to Q2.
But fundamentally, we see also in 2024 demand from the farmers, and this is what ultimately counts. So some clouds, but still a strong business, also 2024.
Very helpful. Thank you both.
So the next one is Matthew Yates from Bank of America. We will then have Chetan Udeshi, and then Laurent Favre. But now Matthew Yates, Bank of America, please go ahead.
Thanks, Stefanie. Two questions about Germany, please. One short term, one long term. The short term one, there was a story on ICIS recently about restarting the smaller cracker at Ludwigshafen. Is that just an automatic return post-maintenance, or was there any discretion in that to respond to demand patterns that you may be seeing so far this year? Maybe that related to Sam's question about the impact of the Red Sea on trade flows. And then the more longer term question, you showed in the deck that Germany lost EUR 600 million last year. This time you already took the decision to shut down a few product lines, and you're alluding to potentially more restructuring to come in the second half.
I mean, Martin, you say the situation is serious, but how radical is the BASF board really willing to be? Because if I look at headcount, German headcount is only down by 300 jobs year-on-year, or about 0.5%. So are we going to see a much more radical approach to the German footprint in order to restore that competitiveness over the long term?
Matthew, I sure start very shortly with the short term. So indeed, crackers, Ludwigshafen, is also our other crackers in the worldwide grid are now running. They run according to demand. We are at the same time standing on our tiptoes, being as flexible as we can to adjust to the demand that we are seeing. But currently, indeed, the crackers are up and running.
So Matthew, I try to be somehow concise, but yes, I said it's serious, because you can really see that, first of all, Europe as such, compared to other regions, lost really competitiveness, but within Europe, Germany particularly lost competitiveness. And this has, in our industry, to do certainly with the product slate, because we have a lot of base chemicals, more base chemicals than the other European countries. That's why also the volumes have been further down in Europe than compared with the average, sorry, in Germany, compared with the average in Europe. And that's also why, let's say our headache in terms of competitiveness is really culminating on Ludwigshafen. Let me also mention that BASF actually had, in a difficult time, really good earnings all over the world, but in Germany.
So we are resilient and, I would say also competitive, but we have to do something here. And now, when it comes to measures, I think what, why I said serious, is that some of the stuff where people and politicians always think the market will come back and then everything is fine, you have to say some stuff in Europe and in Germany getting structural. That means they are the framework conditions BASF will have in the long run, and that's also why Ludwigshafen has to adapt itself to this new market realities. When it comes to jobs and employment, unfortunately, in, in Germany particularly-...
To release people is a difficult task because you have a very intensive protection, basically by labor laws, and this is also why this goes rather slow, unless you really put a lot of money and one-time costs on them to pay them actually to leave. So we use, to a certain extent, also the fluctuation and also the demographic, let's say, situation that we have a lot of retirements going forward. I think that's the cheaper solution than throwing really money behind that. When I say structural changes, then I think we have to look into more of the production facilities. They most probably are not competitive anymore for exporting as Europe, so you have to look at the European market realities. You have to look on what is the decarbonization cost for these assets?
What is actually, and this is also affects in Ludwigshafen, that the assets are older than average than in other sites, whether it really makes sense to maintain and to invest further to keep them. So that's an exercise that the new board will do. But believe me, we are very, very determined to bring the cost down, and this is this EUR 1 billion here, which I think is significantly on top of what we had already. We have good ideas where it's coming out, but let me also say it's not only releasing people, but it is also excellence actually in everything we do, like purchasing and so on. So we will reduce stuff we have to buy. We will change how we buy and so on.
So I think it's important to say that's not only personnel costs. But I would predict over the years to come, that the amount of people working in Ludwigshafen will continuously go down, in a quite significant way going forward. And with that, we are also confident that we will have a Ludwigshafen site, and you will hear then also how that should look like from Markus and, the new board team in the second half of this year. We have an idea how that should look like, but it is a smaller site, and it is a site that is actually focused on, on the European markets and the opportunities there.
Thank you.
So now Chetan Udeshi, J.P. Morgan, please go ahead.
Sorry, two questions. First, you know, just on your guidance, you know, you ended the year with a very, very low number in terms of EBIT or EBITDA. You're guiding full year EBITDA to be in line with consensus. And what I'm trying to get to is, are you happy with Q1 consensus as it stands today? Or, you know, any sense of how Q1 earnings should be? Because even last year, as we thought about recovery in second half, which didn't play out, and I'm just curious how much of that is still the case in this year's guidance, that it's still very back-loaded in terms of recovery and what if it doesn't come through?
So just curious, how would you guide us on Q1, whether related to consensus or any some sort of a number so we get a bit more conviction that this guidance is not like the one last year where it was very back-end loaded and hence subject to risk of you know clearly things not materializing in terms of improvement. The second question, sorry, to be a bit more difficult with this one. I'm just reading, Martin, your comment in the annual report, which says: BASF remains an integrated company with broad portfolio, particularly in a year such as 2023, this structure proved its value once again. And I'm just looking at your numbers in 2023, and it's hard to see the value of the integrated approach.
In fact, you know, if I'm a bit more critical, your capital employed from 2007 to 2023 has doubled, but your EBIT is still down in that period. So again, just going back to the point, we've had this discussion as also the new board looks at the strategic alternatives. Why is the structure of BASF not up for debate? Because clearly, you know, to your comment, it feels to us at least, the integrated approach is not delivering the value just from an external point of view. Thank you.
Chetan, I start with the second one, and then Dirk takes over the first one. I mean, first of all, yes, we have explained to you our so-called differentiated steering approach, which is trying really that those units that are less integrated in the Verbund, and honestly speaking, Coatings, Battery Materials, and Agricultural Solutions are not so heavily integrated, that we give them more space to actually act as the pure play. And I think that will bring the performance up and will allow performance increase. On the other hand, I think where you really have an economies of scale effect is all the services that are provided, also from financial to R&D and to digitalization and whatever.
So we keep them in this because we think they will have lower service costs than actually allowing them to build up their own, their own, piece. So I think this is the concept. This is why I said integrated company, because I'm very honest here, some of the people, and particularly labor, on the labor side, they think this is now going to be a holding, and that is not the intention of that approach, at least not at that moment of time. When you now say you don't see Verbund coming in, I have to clearly say, if you don't have volumes and you have your chemical and your huge plants and chemicals and materials standing, you don't see the Verbund advantage. You see the Verbund advantages when they are loaded. And this is always when you praise us.
In the times when commodities are great, then BASF is super, super stark and strong, and much stronger than the competitors, because that's then actually where the materials and the volumes flow and where then the full Verbund advantage comes in. With a low utilization, you really don't see it, and this is also why I cannot say that and give you big arguments why you would have seen Verbund advantage in 2023. But it is really in the core, and that is also an approach that we strengthen the system of differentiated Verbund, because we will have then one ERP system, one S/4HANA core, that really caters only for the Verbund issues, will be much simpler and with that also much cheaper.
I'm still convinced in this true value chain thing. If the plants are under full steam, I say there is a clear advantage for the Verbund, but not with low load.
Hi, Chetan, I continue with the guidance. I think, first of all, it's great that the analyst consensus is matching our guidance in terms of EBITDA. It's in line with the consensus, yes. Our guidance builds on indeed recovery of the economy in the course of the year. We will see volume growth throughout the businesses. But we also bank on a margin recovery. The first one kicking in earlier, the margin recovery kicking in a little bit later. And then also supported by strong and strict cost discipline, which we already now explained again in our speech.
And to notice that we are not only saving costs on the go, but that we are also taking another step of structural measures, and that will also contribute to that overall. So, we stand by that guidance for sure.
Given that we have only 10 more minutes and eight people still queuing here, for the Q&A, I would suggest that we move to one question per analyst. We'll have now Chris Counihan, Jefferies, then Jaideep Pandya, and then Martin Evans. So now Chris Counihan, please go ahead.
Yeah, thanks so much for the opportunity. On Nutrition and Care, could you talk us through the steps to bring this business back to the targeted mid-cycle, EBITDA margin and the timing to realize this? I just ask it as the business used to contribute closer to high hundreds of millions EUR of EBIT. It's now closer to breakeven. The strategy's been a low-cost producer, waiting for others to drop out of the market, and that's probably gonna take even longer as your European peer is cutting costs, divesting its vitamins business, and presumably, selling to someone who'll drive further cost reduction on its own accord. It also seems opposite to the new cost savings program, where you talk about adapting production for end market demand. So how long do you continue to accept these results, and what's the way out?
Chris, thanks for this one. I take it up. So if we talk about our nutrition business, we have to see, these are three businesses actually. There's an aroma business, there's a vitamins business, and there is a pharma business. So for aroma, there is currently a good volume growth momentum that we are seeing. Colleagues are in a hunting mode also to get the volumes in, because that is very crucial for this business, and we see that happening. Price is still under pressure, but we anticipate that the prices are bottoming out here, and we see a pricing upside here over time. So then for the nutrition business, this is basically with Vitamin A and Vitamin E.
So what do we see here? For Vitamin A, we have brought upstream now the full-fledged Vitamin A plant, which should have the full cash cost advantage in the overall landscape. So here we are leveraging on the economies of scale, now have to fill that plant, but also also with what we elsewhere see in the market, are confident that we are getting a leading position. If you look into the Vitamin A prices, historically, they are really at the bottom, so here we are banking on the on the pricing upside that should come. Vitamin E, the other one, you currently see, and I think you alluded to that also, longer shutdowns of plants, respective plants in China.
So it's in the overall getting a little bit more difficult here, which we see also as a possibility to gain momentum on price and volumes. And pharma, the smallest of the businesses, but also worth noting here, if you take just biopharma, for instance, there was a long, long destocking after COVID, but now finally we see the recovery here. So some very positive views. But you are right, it takes a long breath. It takes patience to bring that business back into the profitable arena.
Thank you.
Okay, so now Jaideep Pandya, Onfield Research. Your turn. Jaideep, we can't hear you. We move on then to Martin Evans, HSBC.
Thanks, Stefanie. Back to guidance for this year, and the risks to it, particularly given last year. If I turn to page 174 of your own report and accounts, the risk section, the potential short-term risks to your EBITDA of key metrics is quite a negative table you present with the risk to your margins of up to sort of EUR 1 billion and a risk to your business from competition of another EUR 1 billion. I appreciate this is the risk committee, and they have to be cautious, but you've discussed margin risk from weaker prices, and you've discussed competition risk from China.
So what is the chance that you come back to this sort of later in the year, particularly with the new board and so on, and say that, in fact, you've taken on board your risk committee's issues with the business, and we get a fairly substantial cut to that EUR 8 billion+ guidance? Because the risk committee's concerns on margins, in particular, look quite scary. Can you discuss? Thanks.
I mean, Martin, this is the good thing that the old CEO can do that, so that the new one can correct it. No, I'm joking. I mean, we have certainly put a lot of thoughts into this, and I think it is a very true and honest risk pattern which we show you. But let me also very clearly say, I mean, I think our guidance is this time not to sell a hockey stick, so everything gets great at the end of the year. But we- I, and I so told this in my speech, that we rather think it will basically be at a similar level and only slowly crawl up everything else, and is upside and positive, we take it as we get it.
For that reason, I think if you look at that situation, others getting maybe nervous, there is the risk, the highest risk on push on prices and losing margins and volumes. But let me also say, yes, we have a volume target, which is higher than the market, which also had to do that we lost some volumes with outages of plants and so on, so. And it is also very different by product lines. I think we took it more aggressive where we are strong than in others. So, but I have to say, most of also the power that is coming from inside, from structures, and this is the cost reduction and all that, what you mentioned, and this is why it is not a very intensive, let's say, market-driven, loaded guidance we give.
This is why I think it is an ambitious guidance. I have no question about that, but it's not unrealistic one, and that's why I think if the environment stays like this, that means we don't have additional wars and interruptions and whatever, I think we are an ambitious but also realistic guidance. If it's coming up and really we get a hockey stick, then we will have to deliver more. But in that respect, we feel comfortably ambitious with our guidance.
Thank you very much.
I see Jaideep Pandya is back in the queue, so, please go ahead now.
No, sorry. One first question is on, your, you know, German plant on how much exports are you doing to China these days from Germany? Sort of ask is, when your China cracker will be up and running, where will these flows go? Or would you have to reduce capacities, given, you know, we are in a overcapacity world for quite a few years. And then just apologies to ask this again, but on your Q1 guide, or not guide, but on your Q1, should we think Q1 will be flattish year-on-year, and you will make up for the 10% midpoint growth that you're alluding to for the year? Or do you think that, your start will be a bit soft, given it's such a big ag-dominated quarter?
Yeah, I'll start with the second question. Q1 had a, I would say, a solid start. Will this be possibly lower than Q1 2023, which was quite a strong quarter in the overall scheme? Yes, this can be, and this would be on the back of the Agricultural Solutions business, as you rightfully spot. So yeah, I think it's spot on. Decent start, solid start, but due to ag, can be that we are coming in a little bit lower. But we will have to see what also the rest of February and March is bringing there.
We cannot give you a detailed picture about exports into China, but it's not such a big volume because we have also very much raised our capacities over there in China. So China, for China, this is also what the whole Verbund side is. What we usually do, we use the global grid to do pre-marketing for capacities coming up, but that is also too early for Zhanjiang now. So I would say, yes, some material flows out, but it's not a dramatic one that I feel jeopardized, that this is now especially attacked, and we have to reduce, let's say, production here in Ludwigshafen, Europe, because of exports to China. So I think it's nothing which you should keep on your list of concern.
Thanks a lot.
Okay, we still have five persons on the list. We'll give it a try, but please, short questions, short answers. As of now, it's Peter Clark, Société Générale.
Yes. Good morning. I'll keep it short then. You talked about tightening belts on the CapEx for the growth projects, and certainly on my calculation, it looks like the growth allocation for the CapEx 2024 to 2027 has come down substantially, over EUR 10 billion to under EUR 7 billion. I know you already trimmed something. You're getting benefits of inflation being low, but has something fallen out of Battery Materials? 'Cause obviously most of the spend on China is still happening. Thank you.
Yes. First, Peter, you are right. We are trimming the CapEx, and so the preponderance of the investment peak now is indeed for the China project. For batteries, we take a little bit of a longer view now and also looking into where we can de-risk with partnerships. So you are right, the majority of the investment is in China. Batteries, we are fully committed, but we are slowing down here a little bit.
Got it. Thank you.
Now we have Andreas Heine Stifel, and he will be followed by Oliver Schwarz.
Yes, very two quick ones. China, can you give an update what you on your own company see? In the Q3 call, you said that your China plants are already running at normal load, but with very thin margins, and maybe an update on where you see the discussions about the state guarantees for the lost Russian assets.
So I would say not so much news on what we said the last time. We definitely don't see the dynamic China everyone would like to see, because the topics are prevailing, like the real estate sector is still difficult. I would say maybe a little bit light on the tunnel in terms of consumer confidence, so people seem to be a little bit more better on that. So we have a slight volume growth in a one-digit number now, basically in Q4. And I would say that's the way it continued also. But let me say that January alone in China, you can have a value on, because you have Chinese New Year, so you have usually to take January and February together.
Too early to say, because depending on whether it's late or early, that has different patterns. But I would say nothing specifically about China that is shooting up or slowing. And me again on the federal investment guarantees, so Wintershall Dea is pursuing these claims diligently. This is ongoing. I have to ask for understanding that we can't come up with details here, disclose any details, but this is positively going on, I would say. And what is always worth mentioning is that these claims are not accounted for. So whatever is gotten back from the federal investment guarantees is a clear value upside compared to what you see in the financial statements of Wintershall Dea and also BASF.
Thank you.
Okay, so now Oliver Schwarz, Warburg, and then two more, then Sebastian Bray and Alex Stewart. Now we have Oliver Schwarz, please.
Thank you. Good morning. Two questions on your free cash flow guidance. The EUR 1.6 billion you expect as a one-off gain and from Wintershall, from the Wintershall deal in Q4, is that included in the free cash flow guidance? And also the new efficiency program in Ludwigshafen, the related costs, are they part of the guidance, or are they likely more to hit in 2025? Thank you.
Yeah, on your first question, what we get from Wintershall Dea here is not the proceeds. This is not part of the free cash flow guidance. So this is out. This is not accounted for in the free cash flow outflow. So you have to see that separately in the investment cash flow. So it's not in. And your second question was on?
The efficiency in the related costs, are they part of the guidance, or is that likely to drop to free cash flow only by 2025?
So this is a special items topic, and we are considering always both the benefits and also the cost and take the net perspective then.
Also on the free cash flow?
Also on the free cash flow.
Thank you.
Okay, now Sebastian Bray, Berenberg, please go ahead.
Hello, hello. Thank you for taking my question. So I would have one on gas, please. What is the guidance assuming in terms of gas price, and is the company reasonably hedged? How much did BASF spend on gas in 2023 versus 2024? We've been very focused on volume recovery, but even if that doesn't materialize, I have the feeling that if gas prices keep dropping, it could be quite supportive for guidance. And quick second one, if I can squeeze it in. Ag, what is going right versus your competition? It seems like, is there a boom in canola seeds? Are you taking market share in fungicides? Thank you.
Yeah, so on the guidance, so you note that we are not giving a guidance out for gas prices. You see where the gas prices are currently standing. I think many people have been a little bit surprised it stays so stable over the winter. It was certainly a mild winter, but I think what we have to take into consideration that in Europe the industrial productivity was also very low, so this explains it. So is there an upside risk for gas prices compared to what we see today? There certainly is, but I think remains to be seen, a little bit crystal ball.
A guidance on gas, we are not providing. On the question of the mix of ag. So what is special, as you know, we have quite an a chemicals loaded business, but we also have strong seed businesses, like the mentioned canola businesses with a number one leading position in Canada, particularly. And what I can say is there is no specific concern about any of our businesses in the ag business, and it seems like both in terms of business mix and also a distributor landscape that we have, we are in a let me say, comfortable position there.
Just, just to check that, can you sell dicamba at the moment following U.S. ruling, or that's not possible?
Yep. So there is an EPA ruling, as you know, which we take very seriously. And for dicamba, the over-the-top application is not possible. And, of course, we are observing any ruling there.
Thank you.
Now to conclude, we have Alex Stewart, Barclays. Please go ahead.
Hi there. Good morning. You'll be pleased to know it's a very quick question. The EUR 1.8 billion of one-time cost to deliver the savings, could you clarify for us how much of that is cash versus non-cash? Would be very helpful. Thank you.
Too early, as I said, Dirk again. So I think too early to break that down. I mean, big part of the one-time cost are obviously severance payments, which eventually turn into cash. That is very clear. But how this will be staggered up over the next couple of years, we will have to see. There will be certainly some rollovers from one year to the other. I would also say that EUR 1.8 billion, as accumulated number, is on the conservative side of things.
Okay. So ladies and gentlemen, we are now at the end of today's conference call. We will present our first quarter results on April 25, right before our annual shareholders' meeting on that day. We will again be hosting a physical shareholders' meeting in the Congress Center Rosengarten in Mannheim. Should you have any further questions today, please do not hesitate to contact a member of the BASF IR team. Thank you very much for joining us today, and goodbye for now.