BASF, the world's leading chemicals group, posted on Thursday a 68-percent drop in first quarter net profit to 375 million euros (499 million dollars) owing to "persistently weak demand."

A gloomy but direct BASF statement said core earnings shed 58 percent to 985 million euros, on sales that lost 23 percent to 12.2 billion euros amid a global economic slump.

Responding to what the group called "an extremely difficult environment," BASF said it "will cut at least 2,000 positions by the end of 2009."

It had already warned of at least 1,500 job cuts this year, but said Thursday that it "will restructure and, where necessary, close or sell plants and sites that cannot ensure the company?s long-term competitiveness."

"BASF is facing enormous challenges in 2009," the statement said, adding that demand for chemical products, used widely in the distressed auto sector for example, had declined further since the start of the year.

It quoted chairman Juergen Hambrecht as saying that "There is currently no sign of a reversal of this trend and we do not consider temporary topping up of inventories in some regions and industries to be signs of a sustainable upturn."

Looking ahead, the chemicals giant said that despite the acquisition of two companies, Ciba Holding and Revus Energy, it forecast "a decline in sales compared with 2008 and an even greater decline in income from operations, which will be negatively impacted by integration costs."

"Our goal of earning our cost of capital is thus becoming increasingly difficult to achieve," Hambrecht warned.

Like many other companies however, BASF did not give a detailed outlook for 2009 earnings.