The Take-Make-Waste concept has dominated the operations of existing economic systems, jeopardizing earth’s finite resources that are at the verge of depletion. Anchored on a linear business model, economies adopt the approach of extracting raw materials from nature, turning them into products and discarding them as waste, with only 7.2% of that waste being reintegrated into the systems as reusable products. As the global population is expected to increase to nearly 9.7 billion people by 2050, resource use will intensify and so will the global waste, threatening to the planetary health, through Greenhouse Gas (GHG) Emissions. If left unmanaged, the waste will aggravate the climate crisis and exacerbate biodiversity losses.

According to Statista, by 2023, GHG emissions had reached a historic peak, amounting to 53 billion metric tons of carbon dioxide equivalent (CO₂e), with 45% of the emissions associated with making products. The Agriculture Forestry and Other Land Use (AFOLU) sector is estimated to account for 24% of the emissions through deforestation and agricultural activities relating to food production and land management. Food production connects to the broader food system which entails growing, harvesting, processing, packaging, transportation, marketing, consumption and disposing of food and food related items.

It is against this backdrop, that it is imperative for economies to redefine their production models to embrace more circularity, in a bid to limit GHG emissions and keep the global temperature rises to 1.5°C as per the Paris Agreement.  According to the Kenya Institute for Public Policy Research and Analysis (KIPPRA) a circular economy is the way out. It advocates for business models that are regenerative and restorative by design and execution. This implies that the goods manufactured under the circular economy can be reused, easily repaired, their by products can be reused and their raw materials recycled numerous times. It is estimated that circular economy strategies could reduce GHG emissions by 5.6 billion tonnes CO2e, which corresponds to a 49% reduction in the projected 2050 total food system emissions, and overall bring the emissions from the sector 45% closer to their net-zero emission targets.

The Principles

Circular economy is encapsulated in three key tenets; elimination of waste, circulating products and materials and regenerative production. The largest emissions in the food system are generated directly through food waste decomposition and indirectly through processing, transportation, and storage. According to Ellen MacArthur Foundation, food waste prevention is a major global agenda formalized in the United Nations SDG 12.3, aimed at reducing food waste and losses per capita to half by 2030. In addressing this challenge, waste must first be designed out of the food system, by preventing any surpluses. Food and Agriculture Organization (FAO)  estimates that over 1.3 billion tons of food is wasted globally each year, with 60% of the waste occurring in the production and distribution phases. Technology can be leveraged for improved demand forecasting through data analytics, and optimized production practices. Additionally, smarter distribution strategies, such as local sourcing and more efficient logistics in the supply chain can be impactful. Alternatively, the surplus can be redistributed for human consumption in food insecure communities to divert food waste from landfills, thus cutting off 87% of methane emissions.

Agricultural raw materials and by products can be kept in use for longer periods, maintaining their utility through value addition, repurposing, upcycling, composting and energy generation. Animal feed, compost, and digestate and biogas are examples of new products that can be made from agri waste. By extending the life cycle of products, enterprises can reduce the extraction of raw materials, lower waste, and decrease the environmental impact associated with production and disposal. Circularity can impact a business’ profitability through reduced operational cost from the designed longevity, that can significantly minimize the need for raw materials and dependency on volatile markets. A 2020 study be World Economic Forum reveals that circular business models could cut supply chain costs by up to 20%. Enterprises can not only foster sustainability but also tap into new revenue streams and improve resilience to resource scarcity.

Regenerative production presents a great opportunity to improve the quality of food for consumers, enhance economic viability and address environmental challenges. The concept ties to growing food in ways that improve soil health, agrobiodiversity and local ecosystems. On croplands it entails techniques that reduce GHG emissions associated with growing certain crops while increasing carbon sequestration in the soil. Such techniques include minimizing soil disturbance through low or no tillage and use of cover crops to prevent carbon loss from the soil. Intercropping, to foster carbon sequestration in roots and microbes and reducing the need for carbon-intense inputs such as farm machinery, water pumping, and synthetic inputs such as chemical fertilizers. These practices can result in 20-30% more micronutrients in crops than their conventionally grown counterparts. Currently, the total cropland suited to regenerative agriculture globally is estimated at 800 million hectares, with about 40 million hectares being farmed regeneratively. If the remaining 80% were to adopt circularity, an annual carbon benefit of 2.5 billion tonnes CO2e would be realized by 2050.

Challenges and the Way Forward

While the opportunities of transitioning from linear models to circular models abound, enterprises may struggle with the process because of limited access to financing as well as lack of knowledge Agri Frontier in Partnership with ANDE Network is bridging that gap by supporting Kenyan enterprises in Agri Waste to have access to finance through its investment readiness and fundraising support services, as well as knowledge dissemination.

This initiative builds into the national and continental initiatives to promote circular economy. At national level, Kenya’s Green Economy Strategy and Implementation Plan 2016–2030 and The Sustainable Waste Management Act (2022) encourages the transition to a green economy and circular economy techniques throughout several sectors of the economy, including agriculture, manufacturing, and construction. At continental level, Africa Circular Economy Alliance harnesses immediate opportunities in Africa for increased circularity in sectors that will support the economy, jobs, and the environment on the continent in the long-term. Overall, more collaboration among the government, private sector and academia is needed to strengthen advocacy and implementation of the solid strategies to support the course.  

By Inzillia Sasi, Agribusiness Financial Consultant, Agri Frontier Growth Hub