LyondellBasell Industries N.V. (LYB) Earnings Call Transcript & Summary

Good afternoon, and welcome to today's webinar. I'm [ Cess ], your moderator from business review. And it is truly a pleasure to have you all here. We're delighted to have our wonderful sponsor, LyondellBasell with us today who will be presenting this titled design for recycling crafting next-generation packaging. Let me introduce our esteemed guest speakers for today, our first speaker, Ivan Meakin, Commercial Manager, Polymers EAI for LyondellBasell. Ivan is a highly experienced and self-motivated marketing professional with over 20 years of success in managing polyolefins and petrochemical portfolios -- known for driving business growth in complex environment, he has strong customer focus and extensive international experience in Europe, Asia Pacific and Oceania. He also has other experience in international diplomacy having worked for foreign Commonwealth office in Tokyo, Japan, educated in Melbourne, Australia, he holds a Bachelor of Chemical Engineering and a Bachelor of Arts. And our second speaker, Gianni Perdomi, a [indiscernible] engineer for LyondellBasell with a technical diploma in industrial chemistry. Gianni began his career in 1986 with Hemant precursor to [ Montell Basell ] and now LyondellBasell. He had extensive experience in R&D, focusing on processing, product and application development and technology business for licensing. Currently, he specializes in application development and technical service, particularly in the film and textile areas. He is also a prolific inventor with several patents in polymer composition, properties, applications and processing. He is based in LyondellBasell in Ferrara, Italy. Now before we dive into the content, let me take a moment to familiarize you with our webinar platform on '24. This webinar is browser-based -- so if you happen to disconnect for any reason, simply click on the link provided in your e-mail to rejoin the session. Additionally, today's webinar will be recorded and available on-demand access. [Operator Instructions] Now without further ado, let's extend a warm welcome to our first speaker, Ivan.

Thank you, Cess, and well, good afternoon, good morning and good evening to all of our viewers. I must say I'm very thrilled and excited to be able to present today designed for recycling, crafting next-generation packaging. I won't repeat our self-introductions, but I will draw your attention to the quick response code that we have there. We'll try and cover as much as we reasonably can in this hour. It's a fairly short timeframe for, I think, a lot of exciting topics that we have for you today. But I don't think we'll be able to cover it all. So do feel free to click on that or something to take that image. And if you have follow-up questions, we have a Q&A session planned at the end of this webinar, but feel free to drop us an e-mail. You should see a link there on the screen, and we would be more than happy, certainly after the webinar to try and answer as many questions as possible. Okay. With that said, let me just draw your attention to customary but important cautionary note regarding forward-looking statements. We will be, in many ways very future-focused here. So with the future becomes uncertainties and with uncertainties there's risk. So please do take time to take note of this. We also do have disclaimer at the end of the presentation slides. Right. Let's move on to today's agenda and sort of the flow of the webinar. So I'd like to start with a little bit of a soft introduction as in Lyondell itself, who we are -- then to kind of really frame what we're doing, we are talking about design for recycling crafting next-generation packaging world, This is not coming out of the vacuum. There are a megatrends in our society that are driving this and shaping the packaging industry. So I just want to touch upon those. And then I'll spend a little bit more time. I think on a very important topic, which is the packaging and packaging waste regulation. So I think this regulatory framework is something we need to spend some time in particular, those forces that are driving design for recycling. At that point, I will take a break, and I will hand over to my colleague and friend, Gianni, an expert really wealth of experience in flexible packaging. And I'll ask Gianni to take us through. I think what you'll find is some very exciting innovative examples of how we're addressing design for recycling. But I won't steal his thunder, so I'll leave that at that. But there are 4 examples, as you can see on your screen. And then time permitting if all goes well, we'll have some interactive questions and answers. Okay, a little bit about us first. So LyondellBasell creating solutions for everyday sustainable living. I think each of these words are actually quite important. Certainly, we are becoming more and more solution focused. And I think, hopefully, that will come through on today's webinar. Every day sustainable living, I think this really encapsulates the fact that we do participate as building blocks, we tend to be a business to business, very much a manufacturer, but you will see an increasing focus on building a sustainable, a low-carbon circular solutions business platform. But I do want to give perhaps a few more metrics around this. And so for the packaging value chain, I think if you look at plastics and polyolefins, we do have a very well -- our strong presence in some of these value chains. So if you look at Europe, we are certainly at the top in terms of the installed capacity, if you put polyolefins as in polyethylene and polypropylene together. Globally, we are #2 for polypropylene. It's not listed on the slide but we also take part in the propylene oxide and said as the #2 global producer. And this is a material for basically the building blocks of polyols which go into polyurethane, which is much more to durables rigid and flexible foams. Innovation is very much part of our DNA. So we are very active in licensing technology. We're active in the catalyst business, as you can see we have many patents. And I'm really pleased to say we're also developing technologies, which are really addressing plastic waste. And I think the one that I would like to highlight is MoReTec proprietary advanced recycling technology, where we have made a final investment decision at the end of 2023. We are building an industrial scale plant in our Wesseling complex. So this is just around Cologne in Germany. And we do expect that to be complete around about towards the end of 2025. So again, this is this is highlighting the fact that we are certainly active and investing in this area. Sustainability, yes, I think this is one of our key pillars and key parts of our strategy. We do have -- what I would like to say is that it is a very aspirate well, very ambitious target here of by 2030 selling 2 million tonnes. I'll repeat that 2 million tonnes of recycled or renewable based polymers. This will all be marketed and sold under our Circulen brand. So we have Circulen recover, which speaks to mechanical recycling. Circulen renew. So there's a polymers made from renewable feedstocks, often hydrogenated vegetable oils. So these are typically waste oils that recovered, processed and then cracked again to form ethylene and then polyethylene as well as polypropylene. And then coming back to MoReTec, again the proprietary technology. This is under Circulen revive, so advance recycling. Okay. Let me switch gears now into megatrends and specifically megatrends that we see shaping the packaging industry. I do want to say, first and foremost that it's not one particular trend that's out there. I think it's a combination of factors or a combination of effects that are really starting to shape packaging as we see it today. There is just no doubt that there is more plastic waste. I was in some ways, well, not amazed, but if you look at the amount of, say, packaging waste in the European Union. It is a very, very steady growth. I just have a number from Eurostat there. So in 2021, we're talking about 84 million tonnes. If you look back at the trend lines in 2009, I think it was around 66 million tonnes. But what is very interesting is that just constantly, constantly increases year-on-year, year-on-year, which in some ways is a little bit surprising to our economy. But nonetheless, with urbanization and population growth, we're using more packaging and not less. Economic factors, I think the days of a linear society where you simply have a manufacturing in the supply chain that delivers a product to a customer, and then that's it -- are behind us. I mean, I think we now look at waste as really a valuable resource. I think parts of the, let's say, the regulations and the policies that we'll talk about today are starting to really address them, provide market-based mechanisms to further speak this along. But we really look at waste now in a completely different lens. We see it as a resource. We're willing to invest in this aggregated process and capture that for essentially what we see as sustainable packaging in the future. Technology, as I mentioned, it's not just us. We see a lot of advances in technology, and there are much more advances in innovation that needs to come. And I think we are slowly but surely moving into that phase where with the right regulatory framework with the right incentives, we start to see, hopefully, a very fertile investment for innovation that will keep sparing this one. And I think this all kind of pulls together ultimately into political factors. I think if you look at plastic waste, it is understandably a very hot topic. It's well broadcast by the media. It's, of course, in the eyes of NGOs. I think brand holders, manufacturers, converters, we're all faced with this. And I think as far as we're concerned with LYB, we're really ready to step up to this challenge and address it. So we do see -- I think PPWR is a classic example of regulation now coming into the forefront to really address an ongoing and significant issue of packaging waste. So with the megatrends complete, I would now like to really talk a little bit about PPW, the Packaging and Packaging Waste Regulation. When I thought about this a little bit and how to best address this in webinar, I -- it's quite daunting because it is in a -- well, it's an enormously complex far-reaching. I think it will be a transformational piece of legislation. And I simply won't have time to go into every nook and cranny of the legislation. So we will focus perhaps in the aspects that drive packaging and design for recycling. So this is the part that I really want to spend more time on. So specifically, that's Article 6 and to a little bit of a less extent, Article 7. But I realize it's a very topical regulation or legislation. So I do want to give it some justice. So I'll [ start ] on the blue screen, if you will allow me just for a moment. So yes, let me cover a few aspects. So I'll give an update a little bit about where the legislation is now in the current day and age. Key objectives. So what is this regulatory framework trying to achieve? And as I will be looking at certain aspects but no others, I will give a helicopter view, if you like a very sort of generic view some of the other mechanisms provisions in PPWR, which I think really are worth taking note of. So the current state of affairs, the most recent, I guess, this milestone was April 24 when the current text was adopted by the European Parliament. This does not mean that the PPWR has been fully enacted into law. It still needs to go before the European Council. We don't expect any surprises there, but that should be around the fourth quarter of this year. And then is approved, which I think it will be. It will enter into publication, into the official journal of the EU. And then 20 days later, it enters into [ Forbes ]. So if you sort of like distill all of that into a timeframe, we should see something effectively entry into Forbes probably around the start of 2025, maybe at earliest at the end of 2024. So, okay. We have PPWR, which will enter into Forbes. Does that mean everything is done and dusted. Absolutely not. In the text, it's quite an extensive text. I think it's around about 321 pages article currently. There will be a significant amount of secondary legislation. So what we will see, and this is part of the text, there's a number of delegating and implementing acts that will flow into really the European Commission. So this is a non-legislative process. We don't return this back into the European Parliament, but the European Commission will have some limited authorities to supplement to add to the existing text. And this is a very important part of PPWR because as we step through, you'll see that we have some very, I think, interesting and sort of defining provisions here. But if you really examine them and say, well, how does this really work? You can see that there's quite a bit of work that will need to be done here to really fully define and enforce and measure and enforce some of these provisions. So the secondary legislation part is what I said is a very -- well, it's a very important space to watch. And I think it's important for the value chain as well because this will really define some key criteria. In terms of, let's say, just the objectives, so why is PPWR brought about? Well, it replaces effectively the PPWD, which is the Packaging and Packaging Waste Directive. The main point is to kind of address and mitigate this relentless growth of packaging waste in Europe. There are -- in this text, there are defined reductions of packaging waste for the EU as a whole and for member states. So we're talking about 5% in 2030, I think 10% by 2035 and 15% by 2040, which is quite unique for a legislation. The other key objective here is to really promote the internal market mechanisms to boost the circular economy. So we do need to find homes for -- as we recycle and we bring back packaging back around as secondary raw materials, well, there needs to be a market demand. And you will see that this regulation does boost that through minimum quantities and mandates to use minimum quantities in -- certainly in plastic packaging. I think the other key point here is PPWR. The R stands for Regulation. And this is very important compared to a directive. So a directive is -- gives member states certain latitude to enact laws in their own legislative -- national legislative assemblies. So you do tend to get okay, a common, let's say, target but quite significant interpretation and different sets of rules in different member states. So the regulation is really -- it's designed to harmonize. It really will be 1 set of rules for all they will be legally binding and enforceable. So this is a big step in certainly in that direction. Yes, as I mentioned, because we will spend quite a bit of time on the aspects that really focused on design for recycling. I did want to just kind of highlight a couple of other aspects of PPWR. So I think one important thing to say is it talks about reduction of packaging, minimizing packaging. So you should only use whether that's by volume or weight. The minimum amount of packaging for a particular function, whether that's protecting goods or keeping food, hygienic safe preserving and extending shelf life, use the minimum. So this immediately speaks to down gauging, light weighting, perhaps, shifts from bulky, heavy rigid containers to lightweight flexible. So there is an element here that's already kind of pushing in some ways, which I think is actually an established trend, but it certainly tends to provide a bit more impetus to it. The other aspects are avoiding unnecessary packaging and void spaces. So I'm sure for all those viewers today you've experienced the box in the box. So where you order something, this is speaking for e-commerce, you get an amazing package and then you open the package to find a lot of air cushions or paper or card. There could be many, many different materials in there. And within all of this, there is a very small actual package that you have ordered. So there will be limitations on that. So void spaces will be maximum 50%. In some cases, I honestly think there's 300% to maybe 400%, 500% is still possible depending on the particular vendor that you all order from. So again, avoiding unnecessary packaging as part of this. There will be packaging bands for single-use operations. So -- and one particular one is where we see collection of goods at point of sale. So we're not talking about the supply chain handling and transportation, if you like, from a business to a retail. But simply at the point of sale, whereas it really is matter of convenience, you can buy 6 bottles of mineral water and not one by one by one, but these applications are set to be there. It's a little bit further than this. It reaches out into the HoReCa sector. Hopefully, I'm pronouncing that correctly, but the hotel restaurant and catering. So these many sachets of condiments that I'm sure we've all seen as well as single-use cosmetic packaging, which is still very typical. I think if you stay in hotels, very convenient, but again, single-use plastics and these are part of that, we say, the applications, the use of applications. That is set to be banned. There are many more aspects. There is a considerable amount of focus on reuse labeling conformity, I could go on substances of concern. So I really think for today, I'll have to limit it to this as I sort of big dive now back into design for recycling. But we'd really welcome your feedback because this webinar is certainly our first shot at it. And if it is useful and so our audience finds it valuable. I'd certainly be happy to do more of it. So with that, let's get a little bit into Article 6 in Article 7. So we're really going to talk about more about some of the aspects, which are driving design for recycling. I just want to put out a disclaimer to start the slide. So you see an infographic. This is really for illustration. Please do not interpret that we have a some sort of secret formula or we're a little bit ahead of the secondary legislation, and we understand yet -- the exact algorithms yet, we don't. What we're trying to describe here is a little bit about how these various aspects will interact and shape packaging. So let let's start at the top. So -- by January 1, 2030, and I appreciate we don't have that to say. But it's January 1, 2030 or I think it's 24 months after adoption of the secondary legislation. If you place packaging onto the European market will need to be designed to be recycled. And how this works is not exactly defined, but there are some I would say, reasonable indications of inability to, let's say, predict a little bit about how this is going to work. So certainly, the recyclability and recycling performance is graded, A, B and C. This is per unit of packaging, and it's per the predominant material in the packaging. So higher than 70% for C, higher than 80% for B, higher than the 95% for A. If you fall below this, you will be in a level which is defined as technically not recyclable. And you'll not be able to place that packaging for sale or for use in the EU market. Now the exact definitions of this design for recycling criteria. It's a combination of materials. It's a combination of parameters of the packaging. So we can see certain factors. So does the packaging have an additive? Does it -- does it have a printing? Does it have a barrier layer? Does it have closures? So these will form ultimately part of the puzzle and part of the answer in terms of what we really mean. But I think, ultimately, when we look at, say, certainly flexible -- the more complex, the more heterogeneous the structure you have, the lower that you will see that. So if we think for a moment about, let's say, high-performance, high barrier food or even PET food packaging, where you may have a standup pouch where you need some mechanical stream, you tend to have a number of different layers that will all attribute the performance to the packaging, one maybe on the inside for direct contact with the foodstuffs, providing a ceiling performance, you may have polyester on the outside, providing good printability, mechanical performance. You may have a lamination so where you combine these layers with aluminum foil, very, very thin 6 or 7 microns. That provides an excellent barrier there. So this is a very functional article and it performs extremely well. But in the light of PPWR, you're very likely to see this as being really described just technically not recyclable. It is very difficult to delaminate this later. So the simpler, more homogeneous, the packaging gets the better. The second point, and I just want to mention here that the second point really doesn't come to 2035, so perhaps that's in line with the infographic. But this is how effective is the recycling. So we're talking about in a calendar year for a certain packaging category, there will be a need to show that you can recycle this at 55% or better. As part of PPWR again in 2035. So a little bit further out -- when it comes to this, again, there's a lot to define. So for example, how would you measure that? So you have to make some measurements about the packaging waste that is certainly being generated and collected then sorted and ultimately recycled. So you need to know at both of those points. If you're a producer of packaging. Will you be expected to conform. So you'll have to know. So there is -- again, there is a requirement for information to float. So you will need to know certainly downstream -- exactly how much we fuel packaging is filing its way back as secondary recycled materials versus disappearing for somewhere else. So there's still quite a bit of detail to work out, but it is an important point to note that recycled at scale, full packaging categories will be very much part of PPWR. Okay. The third point, extended producer responsibility schemes. Now -- there's nothing new here. So we have some of these schemes in operation, I think under the current waste directive by 2025. I think it is mandated for member states to have brought these schemes into place. Perhaps what's interesting here with PPWR is that it will, and that's a strong statement, will reward producers that have a very high recyclability score of performance. So the higher your recycling performance is. So if we're designing for recycling the package is easy or easier to recycle perhaps than other packaging formats. You will have less financial consideration or less fees to pay at end of life of that packaging. So the extended producer responsibility is all about a fee structure that says, well, at end of life, there is still a liability for producers, you still have to pay to bring that packaging around. So will is a very strong statement but it is part of PPWR. So we can see that this is going to influence. Now the last point is really captured in Article 7. So it's using a minimum percentage of post-consumer recycled material or recycled within packaging. Now this doesn't directly influence the design of the packaging, but it certainly does provide a big impetus for boosting demand of recycled materials. So it is a little bit complex in the sense that it depends a little bit on which revenue are talking about, so PET versus other plastics. It also depends on the application. So we're talking about contact sensitive applications and excluding PET for a moment, we look at levels of say 10%. If we're talking about noncontact sensitive, so we're talking of secondary packaging, where you don't have direct contact, then you're talking about much higher percentages, I think, 35% in that case and excluding once again, the polyester PET. So one final point and perhaps just to bring the infographic back into play is 2038. Well, what happens as time progresses. Well, you can see with the recycling performance as we move further and down the road in time. it becomes actually more stringent. So packaging that perhaps was placed in the market with a cycling performance of C. It is technically recyclable because we've been doing it come January 1, 2038, it cannot be placed in the market. So this is -- again, this is a license to operate territory. It's not that it cannot be recycled, but it is not allowed to be recycled. So it's just the progression that we see here is that we'll get tied to more stringent as time goes on. In terms of a little bit of like how are we thinking about this, we don't have that much time. So we're really in mind of the cell focusing on innovation now. We want to get this moving. And that's, I guess, part of the impetus for doing this webinar is to really share that feeling that need for a little bit of urgency here to start positioning even ahead of, let's say, bolting down every single aspect in the secondary legislation. So that will come out certainly in time and with reference and consultation with the European standards organizations, the working groups. But we're getting ready now [indiscernible]. Okay. So and I don't want to be repetitive, but let me just take you through, certainly like it really sort of highlights where we would like to go. And that is to say we want to be best-in-class here. So when we look -- well, how can we address design for recycling, how can we provide solutions that are compliant, not only comply but excel. Well, we want to be best-in-class. So we wanted to achieve the top tier recycled at scale, I mean this will speak to, in some ways, to investments and infrastructure development. Again, the chain of custody, we're certainly taking part of that. So we are investing upstream. I think that's something. And we have those investments, if you look at QCP or [indiscernible], so cycling a rigid -- messy rigid polymers. But we've recently announced a further investment which is sourced on plastics in the German neighborhood. So we are really moving down this pathway. Recycled content, again, I think we bring the Circulen brand here, so whether it is mechanically recycled materials or advanced recycling, we can do that. And so hopefully, we bring this together in the right way we can achieve the sort of top tier status, and that's really what we're trying to get to. But I don't have every single solution. And when it comes to talking to really the in-depth details of our lighthouses innovation, some of the products that we are developing. I really would like to hand over again to my good friend and colleague, Gianni, who has more experience in this field than I can ever hope to. So with that, I will hand the floor to you, Gianni.

Thank you, Ivan. And good morning, good afternoon or good evening [indiscernible]. I'm going to do some samples of show some examples of LYB solution that we are developing or in some cases, we have already implementing for a more sustainable solution and let's say that our targeted [indiscernible] with PPWR. So the first piece, I would like to show you the example of what we call dry pouches, it's normally pouches that contains -- even contain foodstuff but also can contain the [indiscernible] powder of something that we let's say, measured by humidity for instance. In this case, we have already developed and we already introducing in the market some kind of pouches that are replacing heterogeneous composition. You can see that the typical packaging is normally made by [indiscernible] film of polyethylene or polypropylene. And then we have a very often polyamide and then we have [indiscernible] and then we are once again another layer of polymer that could be polyamide of PD or polypropylene. This clearly is a material that is heterogeneous -- intrinsic of heterogeneous. And it is impossible to be recycled. The concept were developed and we are still developing further to use more material concept, the wide concept among the polyethylene range we have that includes a top brand like Luflexen. Luflexen are a brand that covers some grades of what we internally call high-tech polyethylene grades that mix together very broad processing latitude possibly to be processed on newer and even older machinery very easy material with the high stiffness combined with high density, but at the same time have good welding properties and mechanical properties along those inducting from. So -- and Petroken is a family of [indiscernible] that are used in our case to improve, but we have some mechanical properties and ceiling properties. But we don't have to forget that along this top brand, we also have, let's say, cornerstone grade family, let's say, that Hostalen that are major are -- let's say -- let's say, typical high density grade with the superior properties in terms of packaging and processability. And also, we have LD grade that is the basis for some or for most of the type of packaging that includes a very broad range in terms of [indiscernible] for the narration of [indiscernible]. By matching together in this particular case, Luflexen and Petroken in a given ratio, given recipe, we can reduce a package that is made only of 3 types of polyethylene composition where we have a similar layer that ensure the perfect vision and the tightness of the package. We have a core or a functional layer that normally is working as a barrier or functional barrier. In the case of a [ moisture ], the material very often is [indiscernible] like this. And so we can use a high density. And that has a very good barrier itself. In the case of [indiscernible] is acquired besides the traditional systems normally based on other places, but we are moving away from them, possibly. The preferred way is to use that [indiscernible] the position, some type of lacquering, some type of treatment, some of them also under development that assured with a minimum margin of negligible fitness or the -- this [indiscernible]. Third, we have rigid layer that is normally made by a combination of Luflexen or Petroken oil [indiscernible] that can be produced by the means of a different technology. We have a material that can reach very high rigidity by simple blow-fill explosion, and we can boost it if we stress the mono [indiscernible]. And also there is the extreme process that is the [indiscernible]. In that case, we can more than double or more than triple increase the stiffness of the net raw material intensities. So with this combination, at the end, we have a very satisfactory package that can be fully recycled. In the other page, we consider pouches for material that has been submitted to internal treatment or maybe they have to be filled with a hot material [indiscernible] material. And in this case, the typical solution is made by polypropylene material along with [ median ] layer and a key layer that brings stiffness, that brings barrier that brings processability and [indiscernible]. And this type of material once again, works and [indiscernible] it is not recyclable because the 3 month [indiscernible] are incompatible. And for this type of application, when we have a [indiscernible] for instance, we have developed a combination of different layers of polypropylene grade where we have produces a 1 BOPP film in 1 BOPP layer, that is made by rigid polypropylene with high molecules. But at the same time, we can also use in combination with ceiling layer. We've very efficient ceiling layers but it also to have a very low ceiling effect. Then we have a functional layer in this case is the -- the concept is pretty similar to the slide before. So we boost -- we optimize the composition of the core layer. And also, we include treatment like the methoxide or again, special lacquering or special treatment that allows the barrier when it's needed. Then instead to use the PP layer, we used a cast polypropylene layer with the most advanced -- and also using some of the well-known since the [indiscernible] combination of them, and we can obtain a cast polypropylene film that can assure also the mechanical, along with some stiffness and to provide the integrity of the [indiscernible] system. When especially we have to do starting or [indiscernible] the other lighthouse example is the [indiscernible], let's say, in this particular case, [indiscernible]. In the market, you can find a much increased quantity of polypropylene formula [indiscernible] materials, but also, let's say, the material that was used for the case in the common [indiscernible]. In this case, you can find a situation where we have 2 lids of aluminum with a [indiscernible] even these lids can be made also with propylene. But we focus on the core aspect where we have polystyrene -- [ foamed ] polystyrene. And we replaced it with foamed polypropylene. You may say that we changed the 11, in reality that package is much higher because when we moved to recycling film, let's say, the recycling of [indiscernible] and the small amount of polystyrene have a great impact on the recycling of [indiscernible] plastics in particular polypropylene. So we developed a number of formulation that could be based on simply on polymer material with some [indiscernible] and also with some degree of foam or most advanced depending also on the final packaging requirement. [indiscernible] where we can use that [indiscernible] impact to polymer with a hidden level of [indiscernible]. This alone produce materials that have a good balance of impact. But also at the same time, we can have a good breakage for the single portion in case we have [indiscernible]. The last example I would like to show you is about our Circulen revive brand. It is the brand that, let's say, indicates the grades that are coming or what we call advanced molecular cycling very often is also called a generically chemical recycling. But this is in particular the case where we used our technology for that market. And in the Circulen revive, we have a material that can be turned as the back [indiscernible]. So we can polymerize it. And then we obtain material that even is coming from scraps [indiscernible]. In this specific case, we have a personal care packaging [ tube ], okay, where we have a tube that is normally made by polyethylene where we have [indiscernible] that could be made in aluminum, but in some cases, we may have this [indiscernible] like very rigid ones, different from polyethylene. And with this solution, we can obtain a couple of grades from Circulen revive brand, where we use the polyethylene with the same [indiscernible] polyethylene used for the previous sample as well the possibility to use a similar revive grade with the goal to generate gas. And these apps, all [indiscernible] are polyethylene. And so they can be recycled in the same stream. As we have mentioned our Circulen brand, that is fundamental part of the strategy of LyondellBasell, we have seen the figures that Ivan showed at the beginning and the use stock that we have. We just want to remind all you what are the brand, the Viva brand on the top of the consumable and [indiscernible] so we have a [indiscernible] that are polymers made from plastic waste by means of mechanical recycling process. Then we have the Circulen revive. So we make polymers by converting plastic waste, improve new feedstock and to produce a new polymer using advanced molecular recycling process. There is also a third family of Circulen [indiscernible] which are not [indiscernible] for recycling but are more linked to renewable software and our polymer made by renew of feedstock such as [indiscernible] in particular case, use of [indiscernible] the cooking oil and that can be used to generate monomers and polymers. I think that, let's say, from what regard, an example -- I would give the example [indiscernible], we were willing to do. I lead the floor to Ivan for the conclusion, and thank you for your attention.

Thanks, Gianni for that very interesting in-depth coverage of the lighthouses. What I would like to do hand back to our moderator, Cess, and then we can -- I think we have 9 minutes if I look at the clock, and we can go straight into Q&A into and pick up this many of the questions as we can in that time.

Yes. Thank you, Ivan and Gianni for your informative presentations. And let's dive into our live Q&A session. [Operator Instructions]. So let's kick things off this first question. It's a bit of a long one, so I'll ask it slow. All right. So can you share with more detail the performances and features of product families that you mentioned as being particularly suitable to generate packaging, which match with PPWR requirements?

Sure. Let's say, let's, for instance, come back to one of the previous slide the case of the polyethylene for instance, you were mentioned that an example where we use combination of Luflexen and Petroken, but this just one example. As mentioned before, the Luflexen family that is our frontrunner in polyethylene grades is -- let's say it is of some advanced grade that can allow an extremely broad processing that [indiscernible] that for instance, we can reduce sharply the thickness and the weight also of the package, that is one let's say, more and more requested requirement right now doesn't matter PPWR [indiscernible]. But the Luflexen, for instance, and [indiscernible] film where before we were using 120, 140, 100 microns for given application. Now we have 100 or even less the amount of the [indiscernible] of these items produced with this raising, let's say, also, let's say, it's a particular case is the fact that this is an [indiscernible], which is, let's say, not found on [indiscernible] because it's also transparent, even at the higher density it's quite [indiscernible] and this is a special feature. The other case is that, for instance, when we speak about other polyethylene like Hostalen we have grades that despite of being [indiscernible] even decades ago, let's say, we are still working on better and better processing techniques. And so we have done things that were not possible before. So let's say, there is a lot of possibility once we have a good base to work on. In this case, the polyethylene, have certainly a lot of technical content [ over that ]. The same will be applying also to polypropylene family. So here, clearly, in this presentation again I will not enter into much details for every single application. But here, we have for instance [indiscernible] that have 20% or 30% higher stiffness than conventional polypropylene along with the material still [ anchored ] polypropylene, but they are extremely let's say, suitable for [ ceiling ] properties. And they have so grow the latitude that can use in -- by different balance, so we can use in BOPP process, but we can also in [indiscernible], and we use more and more in blow-fill pouch. So there are a lot of possibility with grades that are developed [indiscernible].

Thank you, Gianni. Fantastic question from the audience and fantastic answers too. I see another interesting question from our attendees, and it's about the same topic. Is PPWR actually starting by 2030? If so, what about from now to 2030, are each country's rules for recycling remaining as such? Or will there some alignment towards 2030?

Yes, I'll take that one over. It's okay, Gianni. Yes. So on the clock, when does PPWR really come into effect. So subject to the secondary legislation, there are a lot of -- there are a lot of different talks with different provisions. So if you look say recycling at scale, it is anticipated to be at 2035. But in terms of the main criteria, so we're talking about the design for recycling the recyclability gradings, if you like, the A, B and C and technically not recyclable. That is anticipated for January 1, 2030 or 24 months after adoption of the secondary legislation. So what is happening in between? Well, I think we're all getting prepared. So PPWR will effectively replace PPWD, the Packaging and Packaging Waste Directive. We will see EPR schemes implemented under the Waste Directive. So that will happen by 2025. So we're not less than a vacuum, but I think as a packaging value chain, you can see what's coming ahead. In terms of recycling infrastructure, there is still some time. So when you look at how they define and say recycling at scale, there is some element there to say of the installed infrastructure within the EU and there is sort of further considerations of technological development. So just because of packaging, it cannot be recycled at scale. Now we're not ruling out of the EU certainly not ruling out in the future with technology and innovation that is possible. So I see member states, we're not deviating that much from the existing set of directives. But yes, by 2030, let's call that as really sort of a line in the sand as to when many of these provisions will start to come in and take effect. As I mentioned, PPWR will have an effect, an impact on extended producer responsibility fees. So there's a direct linkage. Whether that happens let's say, before 2030 is a really interesting question. I don't know because it's really going to depend on what specific members state has in mind. So PPWR doesn't set the fees, there's nothing in the text that you can find in Annex or a table of fees that doesn't exist. But it will affect. So that's certainly something we need to look at how it affects to what extent this is a little bit unknown. So hopefully, that answers the question. And just in the interest of time, we'll hand back so maybe we can pick up 1 or 2 more questions.

Thank you very much, Ivan. We're close to our scheduled time, but I'll ask this final question to end our live Q&A session. Is LYB investing in the collection and sorting of waste and thereby influencing recyclability at scale?

Yes. Yes. I'll grab that one if that's okay Gianni. Yes, we are. Very good question. So we are absolutely looking at -- but with through joint ventures and wholly owned assets. So I think, yes, QCP is one of our -- I think, our first facility that was originally get a partnership with SUEZ and is now 100% wholly owned by LYB. So we have mostly rigids, but both for polyethylene and polypropylene products. And we continue to invest. We see this as very much part of sort of unlocking both access to resource waste, which is, frankly, post-consumer waste. We see that as a resource and we see that has a significant value. And then downstream of this we invest into, let's say, technologies that can bring this collected and sorted waste background for another term as a secondary raw material. In the case of advanced recycling, so we really did a very, very difficult, very challenging to recycle streams and mechanically that difficult. But through the use of pyrolysis we can -- and MoReTec is all about using catalytic systems, which is low energy, high yield, not so much after treatment of the pyrolysis oil. Ideally, and maybe it's a step too far, but ideally, the ideal scenario would be at the back end of pyrolysis, you can take that straight to a steam cracker, a decarbonized steam cracker that would be the ideal scenario. Whether we get that far out, I'm not 100% sure. But certainly, recycling or sorting, I should say facilities and investment in those are certainly, absolutely within scope, and we're active in that space. I'll hand back to you.

Thank you, Ivan. Thank you so much, Gianni, for your excellent responses. As far over our time, we'll have to conclude our Q&A session, but please don't worry if your questions haven't been addressed yet as our speakers and team will follow up with you. And that brings us to the end of our Q&A session and webinar. I'd like to express my heartfelt thanks to Ivan and Gianni for their outstanding presentation and to our sponsor LyondellBasell for making this session possible. To our attendees, keep an eye up on instructions for accessing the on-demand version of this webinar. And you can also find it on our website at www.pmi-live.com. Stay connected with us for more exciting webinars and follow us on X that be our webinar [indiscernible] follow our LinkedIn company page Business Review webinars. Thank you once again for joining us, and I wish you a wonderful day ahead.