“Productive Collateral” or “Economic Sense?”: Basf Under French Occupation, 1919–1923

Abstract

At the turn of the century, BASF of Ludwigshafen could look back on 35 years of almost uninterrupted growth. According to the catalogue of the 1900 Paris International Exhibition, the company’s 7,000-strong workforce made it “indisputably the world’s largest chemical works.”1 Its business was the discovery, production and marketing of synthetic dyes. Its customer was the textile industry, a mainstay of the industrial scene in virtually every country on earth. The global market in colorants was systematically developed by BASF and the other German dye producers. By the outbreak of World War I, the German chemical industry had achieved a worldwide monopoly in the dye sector; in the year 1913 it was responsible for some 90 per cent of world production of dyes.2 That year, more than 80 per cent of BASF’s sales revenue came from dyes. With a view to breaking away from this near-total dependence on dyes, BASF had since the turn of the century carried out intensive research in a new area of chemistry, the fixation of atmospheric nitrogen. BASF’s target was the nitrogen fertiliser market, at that time potentially one of the biggest sectors for the chemical industry with a volume almost ten times that of the dye market. The breakthrough came with the Haber-Bosch process, the catalytic reaction of nitrogen and hydrogen to produce ammonia. Fritz Haber, sponsored by BASF, had perfected the continuous high pressure process in 1909, and Carl Bosch and his team at Ludwigshafen undertook pilot plant studies during the following years. In 1913, BASF opened the world’s first synthetic ammonia plant at a new works near Oppau, close to Ludwigshafen. Despite the high capital cost of the new facilities, BASF achieved sales of about 120 million marks in 1913, with a clear profit of some 15 million marks. The outcome was a pretty good profit to sales ratio after taxes of 12.5 per cent. The success of the Haber-Bosch process was to prove even more dazzling after 1914.