Exploring functional barrier coatings for paper, with Conor Ludden

0:23Conor Ludden: Hello everyone and welcome to the latest Packaging Europe podcast. I'm Victoria Hattersley and today we're going to be exploring innovations in functional barrier coatings for paper and board. My guest today is Connor Ludden from Notpla, who, as many of our readers will no doubt know, make plastic-free alternatives to single-use packaging using seaweed and plants. So I suppose perhaps most notably for our purposes today, at least, are there seaweed-based grease and water-resistant linings for takeaway packaging, but they offer much more besides, as Connor will, I'm sure, tell us. So listeners have probably already surmised that we will be talking quite a lot about seaweed-based coatings, although we may also touch upon some other promising kind of materials, such as chytazam, which you've probably heard quite a lot about.

1:12Conor Ludden: So welcome, Connor, and thank you for joining me today. Hi, Victoria. Hello. I'll jump straight into the topic at hand. And I wondered if you could start by giving maybe a brief overview of how you feel the adoption of paper-based packaging has changed in recent years and how the development of functional coatings, particularly bio-based coatings, has kept pace with that. Absolutely. I think there's been a lot of innovation in this space over the last few years. and that's been driven by both regulations and also by brand owners and consumers looking for materials made from renewable feedstocks.

1:52This has been very positive for the market overall. We've seen that there's definitely been a big focus and shift when it comes to curbside recyclable packaging and the evidence backs this up around paper-based packaging. So based on Eurostat, 87 % of paper and cardboard packaging is recycled in Europe and that's compared with 42 % for plastic. So we do see that paper-based packaging does have a very big role to play in this space. Functional coatings have grown with this trend and there's a number of companies, including Nopla, who are innovating in this space, whether it's things like grease and oil barrier that you mentioned, heat sealability, moisture barrier, really focusing on how these different feedstocks and different materials can map over to different use cases.

2:40There have been other coatings and when it comes to different processes broadly focusing on both extrusion and water-based dispersion coatings. A few years ago there was quite a lot of I suppose interest in aqueous dispersion coatings for both paper and paperboard packaging. Whilst this sounds very harmless these water-based dispersion coatings which are known as aqueous often contain styrene or acrylates So they're not really as harmless as they seem in a lot of cases. And those plastic or synthetic chemicals are linked to health issues, and there's more evidence being built around this. So I think it is really important that we continue to have innovation in the space.

3:25We continue to look at both the properties of the materials and the end of life. On the regulation side of things, there's been some very recent updates, even in the last couple of weeks. and in the UK the all party parliamentary group has launched a second report on microplastics and that report identifies an action plan with some key priority areas. They found that 71 % of recorded litter in the UK is plastic so there definitely needs to be a renewed focus on both combating the material type and the end of life management without vilifying plastic as a material because clearly it's very important and continue to play a role as a material choice but there needs to be a focus on how we combat the different elements and the different parts of the value chain.

4:13When it comes to bio-based coatings, definitely can be very advantageous for the right use case. And coming from renewable feedstocks, that is a big plus. What we would say as well is that the bio-based coatings can vary quite greatly depending on the chemistry behind them so not all bio-based coatings are considered plastic free under the European and UK single-use plastic directives and many of them have been chemically modified so that's lengthening of the of the polymer chains and therefore they're still considered a bioplastic under the legislation and a new category of materials is emerging called natural polymers and this is using readily available, abundant in nature materials which haven't been chemically modified.

5:02So we're going through a process of extracting these natural polymers. We're not lengthening the polymer chains. It's not considered a plastic material under the legislation. And that's a really important distinction. How do we differentiate across different bio-based coatings?

5:21Conor Ludden: So not all bio-based coatings are created equal by any means? no no absolutely not i think i think it's um you know we recognize that there's still a lot of innovation in this space and it's important as i said earlier not to vilify materials but i think education and awareness is important when it comes to bio-based coatings uh because the yeah the chemistry can be fundamentally different it's important to back up any claims with third party independently assessed evidence and we saw you know a few years ago that there were some dubious plastic free claims that were being made in the market and for that reason governments such as the Netherlands set up task forces to investigate these plastic free claims.

6:04We worked very closely with this task force called the ILT and over eight or nine months we provided a lot of data and evidence to show why our materials are plastic free under the legislation and they concluded that Nopla was the only material from that research they did in 2023 that met the plastic free definition and it's really important we are continuing to see innovation in the space and new materials emerging but it's bio-based coatings is a broad space and it means it can mean very different things depending on what the feedstock is what the fundamental chemistry is behind

6:39Conor Ludden: behind the material so we have to watch watch out for greenwashing in this space as well yeah absolutely and asking i think asking the right questions if you're a converter or a brand owner and being armed with the questions to ask and I suppose really trying to be transparent to the end consumers. There's nothing wrong with using a bio-based chemically modified coating, it's just being clear on what it is and what it isn't. Okay, thank you, that's really clear. And talking about NotPlaz technology in particular, for what applications your coatings mainly kind of used and why do you think there is such a strong case for seaweed-based coatings like yours?

7:31Absolutely yeah so today we focus primarily on barrier-based coatings for paper board packaging but we do also see a role for the coating materials in thin paper applications so that's something we're actively exploring. I guess focusing more on the paper board or carton board applications. We primarily focus on things such as food trays, things like sandwich skillets, clamshells, etc. We've got over 100 different product SKUs within our portfolio, but we also work with brand owners and converters who develop a bespoke range of SKUs as well, depending on what the market wants. We've also developed a plastic-free film window and it's part of our sea view range and this film window is based on seaweed as well and that is helpful for things like catering or museums where visibility is important in these types of use cases.

8:26To give you a few examples of some of the customers that we've worked with, one of our first major customers was JustEatTakeaway.com and this was a partnership that started back around 2018, 2019 when they were actively looking for plastic and PFAS coatings, they wanted to be an innovative first mover in the takeaway food space and really change the game. I suppose when it comes to food packaging and plastic-free coatings, they were the one who worked with us on those first, replacing those first 1 million single-use plastics in the space. And from there, we started to work with more customers.

9:04Back in 2022, we started working with Compass Group. And within Compass Group, one of the customers we work with is Levy UK. They are responsible for contract catering with a large number of stadiums. We work with food service, going through different food service distributors we can supply to Levy and they have a big focus on reducing carbon emissions and moving towards net zero. Winning the Earthshot prize in 2022 to build a waste-free world really helped strengthen that relationship and helped us to roll across a number of different stadiums. We also did some independent lifecycle assessments to help give them the confidence that what we were doing and adopting NOFLA packaging at scale was really moving the needle for them when it comes to replacing single-use plastics and reducing carbon emissions.

9:56And we've now replaced over 6 million single-use plastics across Libby's stadiums and other sites, primarily in the UK, but now increasingly in other countries such as Netherlands, Ireland and the US. And I guess coming on to the Netherlands, again, another customer that we work with there is a converter called Compacts. They are quite a large converter, part of Papstar Group. We started working with them again a few years ago. Netherlands has been one of the leading countries when it comes to single-use plastic regulation and in the context of packaging specifically. And this working with them has been really, yeah, it's been a really good experience.

10:38they've been able to reduce their single use plastics and definitely, you know, when it comes to plastic taxes, that was something that was introduced in the Netherlands a few years ago. So they wanted to have a solution which didn't involve having to pass on these plastic taxes to their customers. And now we work with a number of Compaqs customers using Nopla coated board, one of which is Qualitaria, who are a quick service restaurant chain. And Nopla packaging is now used in over 160 restaurants in the Netherlands. So a really good use case and really good story of how we've seen this progression over the last few years.

11:12It's not really a space that we were in two or three years ago, but we're now starting to see adoption across different geographical markets, different verticals. And I think, yeah, now some of the initial objections or some of the initial hesitancy, we're now seeing how, you know, sometimes it can be hard to overcome initially. But now we've overcome that. Both NotPla and the customers that we work with are starting to reap the benefits.

11:39Conor Ludden: So with these kind of major clients, some of the ones you've mentioned, what would you say has been broadly the kind of common impetus for them all behind kind of exploring, working with you and adopting your technologies? Is it that kind of that need to be seen to be to be the first move or is it awareness of impending kind of regulatory things that everybody used to be on top of? Definitely. There's a few factors and you mentioned some already. I think definitely being a first mover, whether it's a first mover in your industry, a first mover by geography, that is definitely something for some of the brand donors and converses we work with.

12:18If they've got someone who is leading these innovation initiatives and they want to be very innovation centric, that is definitely a big factor there. regulation is I think an inevitable driver of a lot of this change because it's so market-wide and market-reaching it's probably the number one driver of adoption across different markets but also I think there's also consumer demand and consumers are increasingly becoming more aware of different types of materials and you know I think even going back 10-15 years ago a lot of consumers would have just accepted compostable and plant-based as oh I can throw it in my compost and it will break down immediately we now know that's that's not the case for certain compostable packaging so there is now a lot more awareness on the consumer side they're asking lots of educated questions and we are seeing change at the brand owner level and that's and that's driving some of that change with the with the converters as well lovely thank you and given this you know

13:23Conor Ludden: obviously very encouraging much more widespread adoption I wonder if you could explain to me to somebody who is obviously not a chemist um what are the most groundbreaking technical advances that have kind of enabled this have there been you know have there been any kind of major leaps that you can sort of explain to me over the past few years because it's quite challenging especially for food applications to create the kind of barriers necessary isn't it absolutely and I can't take any credit for the technical improvements we have a very talented team of material scientists and engineers and other people who've got a variety of different backgrounds and skill sets and bringing that together has allowed us to make these these big leaps forward I think when you're working with natural materials when it's seaweed or if it's another type of feedstock there's often quite a lot of variance in the raw materials that getting in or it can be a lot of variance especially because a lot of our suppliers and for similar companies in our space they're not used to supplying this feedstock for packaging materials so there isn't really a packaging grade of seaweed or there isn't a packaging grade of kytosan as it stands at the moment and really you know that involves trying to when you're when you're trying to drive something that's very new in the market it's developing this specification, it's trying to reduce batch to batch variation, it's trying to control as much of the properties and the variation that you can control so that we can map over the processes from the lab to industrial scale.

14:57And that's involved years of research and development, years of work and close work with suppliers at each stage of the value chain to do that. So I think, yeah, it's really important for us to try as much as possible to minimise any variation in the materials to increase the production speed and the capacity. That's clearly important to reduce costs, to work with more partners. And then the other thing is reformulation and to enable the compatibility of our material grades with a broader range of production techniques. We try as much as possible to have grades that are compatible with existing machinery and equipment.

15:38Yeah, I was going to ask that actually. Yeah, sometimes there is a bit of tweaking to the process. So, you know, I think I try to avoid using the term plug and play. It's used a lot in the industry. And, you know, whilst we do work with existing machinery and equipment, it's not to say that for every manufacturer converter that it's going to work on day one. Sometimes it requires a bit of work and a bit of collaboration. But we've seen the results when we've been able to do that. We've seen how that progress changes over time. And we've seen that we've been able to work with partners without them having to make large capital investments.

16:13or without having to invest in new machinery etc. I think seaweed-based coatings are highly regenerative which is one of the main reasons that we work with them and they're a lot less input intensive than land-based crops so they don't require any fresh water or fertilizer, they don't compete with land-based food crops which is clearly very important with the pressures on supply chain when it comes to food and to water. I think we recognise that not one material is going to solve all the challenges that we have in the space. So there is a need for a portfolio of different material solutions. We do ourselves work with other raw materials as well, other feedstocks.

16:57And we've seen that you mentioned Kytozan earlier, there's other agricultural byproducts such as Zine which is found in corn kernels which is again showing some promising results and progress across some different applications and so I think yeah there is really a need for a family of different solutions and I think when we've had you know a converter or a manufacturer adopting one of these solutions this is almost you know being a trailblazer for newer solutions to follow and allow you know almost allow all the boats to rise as we start to bring these new solutions to market. There are more challenging packaging applications, and it's not to say that natural polymers or biomaterials can solve absolutely every packaging challenge today.

17:44We're fully aware of that, and we try to be as honest and as transparent as possible with our partners in terms of what our materials can and can't do, particularly when the food contents or the products require a higher barrier to moisture. It's something very difficult for chemically unmodified seaweed because it is a hydrophilic material, hygroscopic, and therefore what we're looking at is seaweed in the context of other natural materials that can be used to develop coatings with a higher barrier to moisture. We've got an ongoing Horizon Grant project at the moment. We're in year 2003, and we're part of a consortium of 15 different companies looking to develop a plastic-free natural barrier for things like coffee cups and other liquid cups.

18:34So this is a very exciting project and lots of work being done by our innovation team and other stakeholders on this. So I think, yeah, there's definitely a huge amount of engagement and interest in this in the market. But we're always being as transparent as we can be in terms of what is the material suitable for today and what are the limitations. applications.

18:57Conor Ludden: We'll have to keep an eye on that project then that sounds really interesting. So you mentioned the coffee cup so what other applications are still very much out of reach and is the kind of a way of bridging that gap do you think in future is that something that teams like yours are working on? Definitely I think for more flexible packaging applications that require heat sealability. We've got some ongoing projects at the moment on this, but it's not something we can do at scale today. So for paper-based sachets with a heat-sealable coating that also has some barrier properties, it's quite an interesting proposition, especially we've seen in the UK there's been another push by two years around recycling flexible plastics.

19:44Some European countries have started to adopt this, but the UK has pushed it back another two years again. So there is definitely a big interest in the market from consumer brands and from converters to have flexible packaging formats. And I think generally thin paper packaging, it doesn't even need to be for sachets or for heat sealable applications, but also for greaseproof paper and those types of things as well are quite interesting for a number of the customers that we work with. So I think, yeah, there's definitely a, We built out a product roadmap that we're looking to build into, whether it's different manufacturing formats, whether it's improved barrier properties or really if it's just going into a completely new market vertical.

20:33Each market has its own requirements. For example, I think in the west coast of the US, I've heard that they do like a lot of molded fiber packaging and food services, whereas in the east coast of the US, it tends to be more sort of your traditional folded carton board packaging. So even just from a regional point of view, and the same goes for the European market as well, there's a lot of differences in preferences by region. And it's trying to adapt your product portfolio as much as possible to those regions. And from a not-blood point of view, this is really where we started to move further up the value chain and starting to build up this ingredient brand proposition.

21:15To date, most of what we've done has been selling finished packaging products to food service distributors and then onwards to contract caterers and other brand owners. but increasingly what we're what we're seeing is allowing the the increase in scale and the increase in geographical expansion is working with those converters paper mills other partners in the value chain to directly whether it's selling the coating or the coated board trying to plug into that wider market opportunity and we expect that to to continue to grow there's not just one correct business model and I think running different ones in parallel is important but also having a clear view on you know what is the business uh focusing on um i think it's really important and uh yeah we've really sort of built that out over the last the last year or so cool thank you um and aside

22:09Conor Ludden: from the um technical applications and technical challenges that we've discussed are there any ongoing roadblocks to to the wider adoption adoption of kind of bio-based barrier papers and boards that we haven't discussed? I'm thinking maybe in terms of lack of regulatory alignment or consumer perceptions or anything like that. I think regulations can be a barrier, but they can also be an opportunity. It really depends when there's, I guess, quite a lot of difference in regulation across different countries or different interpretation of the same regulation. That can be quite challenging, especially as a as a growing company that focuses on innovation.

22:54Even for larger packaging companies or materials innovation companies, it's a challenge. So for us, when we don't have a very large policy or regulatory team, it's a bit of a minefield to navigate. I think PWR will help level the playing field across Europe and provide that much needed clarity. There is more work that needs to be done done when it comes to distinguishing natural polymers from other dispersion coatings such as aqueous coatings. Yeah, it's still confusing I think. Exactly, yeah. So I think that's something where there's more work to do. There's definitely some more at the European level recognition that the European Economic and Social Committee you know has started to go through this process of recognizing natural polymers as a distinct and not plastic category it's not fully gone through yet but the first vote went through a couple of months ago so we're starting to see some some recognition at the at the European policy level for for natural polymers and this is really the work that's been done in the last two three years by Nopla and a handful of other companies who've sort of had these conversations and talked about the science and the chemistry behind that and the good thing is that policy makers have been very receptive to these conversations.

24:18I think in addition to regulation there are other barriers as well. We see that waste management can be very different across different countries or even areas within countries. Municipalities have their own policies when it comes to waste management and sometimes that can be a barrier for adoption because we go into a new area or a new country and we say we've got all these certifications around end of life whether it's recyclability home and industrial compost certifications and sometimes the brand owner says well our waste management provider won't accept this you need to have a conversation with them you need to certify with x y and z so that that can be a barrier as well i think to to adoption across new markets.

25:05In theory but not in practice. Yeah exactly and we do try you know as much as possible to be to be flexible in having these conversations and to try and build these relationships but it's not a scalable model for NotPlan for other companies in our space. We really need some more standardization when it comes to both waste management and just regulations more broadly. And yeah there's maybe I think the third point I would make as well is there has been a perception in the past among some brands that natural polymer coatings can't scale or there's significant scaling challenges. Sometimes that you know they might think that and this is true in certain cases but not in all cases that the material or the feedstock is constrained by capital investment or just general capabilities.

25:58So I think for a brand or for a converter asking the question to the material supplier, material innovation company, what are the constraints on your production capacity and scale? From a monopoly point of view, we're not capex constrained, we can grow quite quickly across all the partners in our supply chain. With the global seaweed industry, it's increased when it comes to farm seaweed, it's increased fourfold over the last 25 years. We did a quick calculation recently that we could replace over 500 billion food trays with existing seaweed extract that we use based on the current annual production.

26:34So we do see it as a scalable material and it can be done in a way that is also sustainable as well. So we work with our seaweed suppliers to do the due diligence, ensuring that they have the right sustainable credentials but also the right labour management practices in place but I think yeah it's definitely definitely very exciting and it's really trying to change perception and perceptions in the industry that we can get solutions that are truly scalable and truly plastic free.

27:05Conor Ludden: So we are really at a good point in terms of this material at least anyway which is great to hear I'm sure we're going to be covering this lots more in the coming months. um i also finally i just want to i know when we spoke about this before we were talking about the sort of push we're seeing towards greater supply chain transparency and i was wondering how you think this is going to kind of help what what can be seen as more niche technologies like these by best coatings to become more mainstream and help brands to demonstrate a point of difference definitely and i think the standardized labeling will help this so when it comes to um plastic free claims with barrier coatings to be verified and there needs to be um and spoken a few months ago with oprl when it comes to labeling pbwr again will be a catalyst um for helping to create more clarity um on supply chain transparency um and and really i think it's um similar to what mentioned earlier of the various different certifications it's not trying to create too many barriers for innovative new companies in the space because I think sometimes these certifications can be really expensive to get so if you personalize the material it makes sense at that stage to get certification but sometimes it can be a bit of a chicken and egg situation when it's new materials that are in development we get asked by brands and conversions why don't you have certification for this and the answer is well the material is still in development and certification can cost 20 000 euro potentially more than that so we do we do get we do have the certification for commercialized materials but there needs to be a sort of phased approach to this and definitely as long as the the company is working as we do to the same principles as before the same technology and the same chemistry then we're very confident that we can get these certifications and we're you know for us we don't want to cut any corners we don't we're not we're not interested in mixing our materials with synthetic or plastic coatings and we're very much focused on building this ingredient brand which is a recognizable trust mark for brand owners and for consumers this isn't really the default for barrier coatings in the industry at the moment what consumers see is a what looks like an invisible transparent layer on the inside of food packaging and there's nothing really else to it so there's no way for a consumer or a brand owner to determine what is that barrier coating and I suppose having our logo on the on the end packaging whether that's going through a converter or a food service distributor it's taken a bit of time to address potential objections on that because it's not the industry standard but that brand owners and converters have started to see the value of that we're seeing that it's easier to have these conversations it's being treated as less of an inconvenience and more as a brand value add for different partners that we work with um there's i think there will be there will be further objections in the future on this as we move into new industries and new geographies um but it's something we now have this experience of navigating trying to have these conversations up front with brand owners and with with converters to say this is this is the value to you and this is the importance of using the Nopla Trust mark we've worked with across you know anything from um quick service restaurants that I mentioned earlier to uh large stadiums um such as Wimbledon and Twickenham who we work with um so I think yeah definitely uh definitely been a journey to get to where we are today um and more to come on this it's very much not the not the finished picture um but we've seen that that value of what what transparency means in practice for for customers and that is not clubbing corners, not green washing in any way and being very clear on what the material is and what it isn't.

31:03Conor Ludden: And that benefits everybody of course I do think it's something that is going to become much more familiar and we'll be seeing more of it and you will become much more visible on packs as you say. Absolutely yeah I think it's a really good time to be involved in this space and to be innovating in this space and I think yeah competition is great as well we see that as a really positive thing overall and ultimately it shows that it gives that sense of validation that there's other companies working on this it's a big space it doesn't make sense to like necessarily vilify other solutions that are working on innovative natural polymers in the space but really to focus on what your solution can do where it can fit in and how we can uh how we can sort of revolutionize the packaging industry together um so i think it's yeah it is a really exciting time yeah and as you say like one solution isn't ever going to fill every need so we're going to need this kind of patchwork of um sustainable materials working together so yeah and i think you made that point very clearly early on i think i think it's probably a nice point to stop at today because that gives us a lot to think about already.

32:16Conor Ludden: Just so our listeners know, we'll be publishing a longer report on this topic in the membership section of our website, so do look out for that. Connor, before we go, is there anything else that we haven't discussed that you would like to draw our listeners' attention to? No, I just want to say thank you for having me on. There will be more to come, I think, in terms of Nopla events and things coming up in the next few months, so I would encourage those who haven't already to follow Nopla through LinkedIn and through Instagram. Those are our main channels at the moment. We've also restarted our newsletter again, which will be available for people to get some more updates from us.

32:57But I think, yeah, really, other than that, thanks for having us on today. I really appreciate the time and thought it was a really good discussion. I'm very happy to answer any questions that the listeners might have at a point in the future.

33:09Conor Ludden: yes so get on to Conor if you have any questions thank you thank you so much really appreciate your time it's been really interesting and of course we'll also be covering any updates from you guys as and when they appear also thank you to our listeners and we'll be back again soon take care everybody

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