LyondellBasell Industries N.V. (LYB) Business Profile

What it does

LyondellBasell is a global chemical company that turns hydrocarbon raw materials into plastics and chemicals. Founded in 1985, it is headquartered in Houston and led by Chief Executive Officer Peter Vanacker. It was incorporated under Dutch law in 2009.

Its large processing plants make materials used by other manufacturers rather than finished consumer goods. Customers use them in food packaging, furnishings, automotive components, paints and coatings. The company produces polyethylene and polypropylene, two widely used plastics, as well as the chemical building blocks used to make them. It also makes chemicals used in products ranging from insulation and cushioning to adhesives and gasoline components.

Another business blends plastics with additives to give them properties suited to particular uses, including automotive parts, packaging and agricultural products. LyondellBasell also licenses production technology to other chemical manufacturers and sells catalysts, materials consumed in manufacturing processes.

The company manages these activities through regional olefins and polyolefins businesses, an intermediates and derivatives business, an advanced polymer solutions business and a technology business. It has manufacturing facilities in the Americas and Europe and participates in production joint ventures in several countries. It ceased operations at its Houston refinery in February 2025.

How it makes money

LyondellBasell earns revenue by selling chemicals, plastics and fuels-related products, as well as by licensing technology and selling catalysts. Its regional olefins and polyolefins businesses make ethylene and other basic chemicals, polyethylene and polypropylene. Some of the ethylene and propylene produced is used within the company to make plastics and other derivatives; the rest is available for external sales.

The intermediates and derivatives business sells propylene oxide and its derivatives, oxyfuels used as gasoline blending components, and intermediate chemicals. Advanced Polymer Solutions sells plastic compounds and other materials formulated for uses such as automotive parts. The technology business licenses production processes, supplies catalysts and can provide training, plant startup assistance and ongoing technical support.

Sales use a mixture of contracts and spot transactions. Polyethylene and polypropylene are generally sold under annual contracts or on a spot basis. Some propylene oxide agreements run for multiple years and have cost-plus pricing. Technology licensees may continue buying catalysts under long-term supply agreements, providing sales after the initial license. Product prices nevertheless respond to supply, demand and feedstock costs; the company cannot always pass cost increases on immediately.

Polyethylene sales accounted for approximately 24% of consolidated revenues in 2025, while polypropylene accounted for approximately 19%. Oxyfuels and related products accounted for approximately 16%.

Cash from operating activities was $2.3 billion in 2025 and approximately $1.7 billion in the third quarter of 2026. The company invested $1.9 billion in capital expenditures during 2025 and $303 million during the third quarter of 2026.

Customers and how it sells

LyondellBasell sells to manufacturers that turn its plastics and chemicals into packaging, automotive components, construction materials, household goods and other products. Its advanced polymer business supplies materials for automotive and other specialized applications. Technology customers include manufacturers that license its processes and purchase catalysts.

No single customer accounted for 10% or more of total revenues in 2025, 2024 or 2023. The company sells through its own regional sales organizations and through distributors. Polyethylene and polypropylene customers buy under annual contracts or in the spot market; some other products are sold under multi-year agreements.

The company has principal manufacturing facilities in the Americas and Europe, alongside joint ventures in countries including Saudi Arabia, China, Poland, South Korea and Thailand. Its regional sales offices and representatives serve Europe and Asia as well as North America. Americas polyolefin exports are primarily sold to customers in Latin America. The intermediates business sells through its personnel and distributors across the Americas, Europe, the Middle East, Africa and Asia-Pacific.

In Europe, polyethylene and polypropylene are primarily transported by railcar or truck. In North America, a pipeline system connects several Texas facilities to Gulf Coast consumers, while railcars and trucks carry polyolefins.

Suppliers and costs

The company buys natural gas, electricity and steam to power its facilities, and natural gas liquids and crude oil derivatives as feedstocks. Raw materials are the largest component of the cost of producing olefins and their co-products. The Americas business uses natural gas liquids such as ethane and propane as well as heavier liquids; naphtha is the primary feedstock at its European olefin facilities.

LyondellBasell also purchases propylene from third parties because its internal needs exceed its production. It obtains other materials from its own plants, joint ventures and external suppliers under contracts and through spot purchases. Its advanced polymer business buys materials including plastic resins from its facilities and other suppliers.

Feedstock and energy costs represented approximately 70% of total annual cost of sales over the last three years, after the refinery business was reclassified as discontinued operations. Other variable costs accounted for approximately 10% to 15%; fixed costs, including employee compensation, depreciation and maintenance, made up the remainder.

The company can vary feedstocks at its U.S. and European olefins plants. Its ability to pass higher raw material costs to customers depends on market demand, and timing differences between feedstock and contract price changes can make margins volatile.

Competitive position

LyondellBasell competes with regional and multinational chemical companies, producers of plastic resins and compounds, and chemical divisions of large oil companies. In olefins and polyolefins, competition is based on price and, to a lesser extent, product quality, delivery, reliability, performance and customer service. No individual competitor is named in the supplied business descriptions.

The company believes that, as of December 31, 2025, it was the largest producer of polypropylene in North America and the largest producer of polyethylene and polypropylene in Europe, based on capacity data that includes its share of joint ventures. It also believes it was the second largest producer of propylene oxide worldwide. These are production-capacity positions, not stated market shares.

Its U.S. plants can process a range of raw materials, and relatively low-cost natural gas-derived feedstocks have benefited North American profitability. The company also licenses process technology and owns patents and patent applications covering processes, products and catalysts. License customers can buy catalysts and support after the initial agreement.

Our reading: Feedstock flexibility and production scale provide a meaningful cost position, but price-based competition and changing raw material costs limit its durability. Our reading: Technology, intellectual property and ongoing catalyst supply provide a more differentiated position, although licensing demand can weaken when customers slow capacity additions.

Growth opportunities

LyondellBasell’s strategy includes upgrading its core businesses, developing circular and low-carbon materials, and improving performance in Advanced Polymer Solutions. It is building MoReTec-1 in Wesseling, Germany, to convert hard-to-recycle mixed plastic waste into feedstock for new polymers. The company expects annual capacity of 50 thousand metric tons per year and has targeted startup for 2027.

The company aims to produce and market 800 thousand metric tons of recycled and renewable-based polymers annually by 2030. It says that ambition depends on completing MoReTec-1, expanding its recycling footprint, increased demand for circular products and supportive regulation. It has delayed certain sustainability-related capital projects while continuing to invest in MoReTec-1.

For a potential MoReTec-2 project, the company does not yet see sufficient U.S. regulatory support to enable an investment. It currently assumes that the project would also be in Europe, after a successful MoReTec-1 startup and learning from that plant.

The company is also seeking more output from existing assets. It increased high-density polyethylene production at Morris through a new operating mode with minimal capital investment. At Channelview, it says its value enhancement program increased capacity at the PO/TBA facility to 110% of design.

In portfolio changes, the company sold four European assets in May 2026. It also agreed to sell its former Houston refinery site and associated assets to Valero, subject to closing conditions.

Structural risks

• Industry cycles and capacity: Petrochemical supply and demand, new production capacity and price competition affect results. During 2025, capacity additions outpaced global demand growth, and European polymer margins declined amid import competition.
• Feedstock and energy costs: The company purchases large quantities of energy and hydrocarbon feedstocks. Its ability to pass increases to customers depends on demand, while delays between raw material and contract price changes can make margins volatile.
• Manufacturing and logistics: Chemical operations face risks including explosions, fires, severe weather, mechanical failures, supplier disruptions and transportation interruptions. Low Rhine water levels constrained European logistics in September 2026.
• Environmental and regulatory costs: The company cannot predict future health, safety and environmental compliance costs with certainty or guarantee they will not be material. Its circularity ambitions also depend on supportive regulation, customer demand and investment and infrastructure capability.
• Economic and customer-industry weakness: Economic downturns can affect operating results and cash flows. Advanced Polymer Solutions is exposed to automotive industry volatility; weaker automotive demand reduced its sales volumes in 2025.
• Cybersecurity: More sophisticated cyber threats could affect systems, networks, data, facilities and services, while expanding regulatory requirements could increase costs or disrupt operations.

Bottom line

Our reading

Our reading: LyondellBasell is principally a large-volume chemicals and plastics manufacturer whose results depend on the spread between product prices and feedstock costs, alongside demand and industry capacity. [item1, item7] Its feedstock flexibility and technology business provide useful strengths, but they do not remove exposure to commodity cycles. [item1] Recycling and operational improvements offer routes to growth, while execution, demand and regulation remain conditions for the circularity strategy. [item1, call_qa]