Adaptation10: Chemicals Giants Scramble to Climate-Proof as Weather Risks Mount

Three years ago, the River Rhine — the busiest waterway in Europe — shriveled up amidst a period of severe drought. The low water level snarled industrial supply chains, crippling all kinds of businesses.

Chemicals giant BASF was one company at risk. Its four-square-mile integrated production facility at Ludwigshafen sits right on the banks of the river, serving as a key transit hub for the firm’s myriad products. However, the company was prepared. BASF had installed a low water early warning system to alert it to approaching trouble and had reshuffled its logistics so freight could travel by rail or specially adapted boat as needed. In October 2022, it even unveiled a new kind of tanker, capable of navigating the Rhine at a water depth of just 1.6 meters. BASF’s actions made it the poster child for climate adaptation across the chemicals sector.

Many of the company’s peers recognize the growing climate threat to their operations and supply chains, too — and are seeking ways to climate-proof accordingly. This is illustrated in data gathered by CDP, the independent environmental disclosure system. In 2023, out of 917 reporting chemicals companies, 281 (31%) had identified physical climate risks they considered substantive in their value chains, while 224 (24%) said their business strategy was informed by a risk assessment process where at least one such risk was identified.

For this month’s Adaptation10, Climate Proof and DSR & Partners reached out to a number of chemicals industry professionals to learn more about how this important sector is adapting to climate risks — and what opportunities they could take advantage of in a warmer and wilder world. 

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