Chemical giant BASF said on March 25 it will temporarily shut down part of a key German production unit as it reduces production by a quarter owing to a slump in global demand.

BASF plans to idle the smaller of two steam crackers near its headquarters in Ludwigshafen, southern Germany, a statement said, adding the firm had trimmed global production capacity by more than 25%.

A steam cracker is a petrochemical plant that turns naphtha and light hydrocarbons, mainly crude oil, into ethylene, propylene, and other chemical raw materials.

The shutdown of at least three months would sharply reduce output of ethylene, a product used to make plastics.

Copyright Agence France-Presse, 2009