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The balance sheet approach to assess the transition of agricultural system towards circularity

The Balance Sheet Approach to Assess the Transition of Agricultural System towards Circularity

Dr. Valeria Grippo


In the last period, the concern about how promoting circularity increased worldwide. The central issue that emerges among researchers and public authorities is how to assess the circularity value of a product or a process, all along the lifecycle, and throughout the value chain during the design or re-design phases.
The Balance Sheet Approach (BSA) is a framework defined to analyze complex problems of natural resources management that combine different methodologies in order to present environmental, socio-economic and financial evaluations. In this analysis, we aim to observe, through a case study, the application of the BSA as a framework to measure advantages and disadvantages of the transition of the agricultural system toward a circular approach.
The BSA provides the incorporation of different valuation concepts and methods into sequential stages of the decision-making process and their application domains. This study started from the analysis of the agri-food system at a national level. The vegetal residues, generally discarded, with a high potential value, represent one of the main output of the agri-food system. In the first balance sheet, we measured the relationship between economic variables and agro-industrial vegetal residues in order to investigate the existence of a Waste Kuznets Curve and identify the variables that most influence the waste production. The analysis moved then towards a regional contest (Puglia and Basilicata) analyzing a specific production process (the cereal production) and its main output (bran).
In the second balance sheet of our analysis the value of the cereal chain was measured, by using bran as by-product. Basing on the concept of the “cost-opportunity” to compare the linear approach (meaning discard bran in landfill) to the circular one (where bran is re-used as input for other industries: paper and biogas production), we measured the cash flows of each alternative both for producers and industries.
In the third balance sheet, the analysis deepened, including environmental and social aspects through a multi criteria approach (MCA). We used both quantitative and qualitative data and selected the criteria according to the stakeholders’ preferences. The weights were derived from choice modeling.
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