New Agricultural Trends in Post-pandemic Era: Circular Agriculture

2021 was a year of rapid change in human development under the impact of the COVID-19 pandemic. Depending on the severity of the outbreak, many countries adopted various countermeasures to control the spread of the virus. In the post-pandemic era, people's lifestyles and habits have quietly changed due to working from home and digital services such as online shopping. Furthermore, facing the pressure brought by natural resource scarcity, food shortages, and inflation, countries around the world have placed importance on issues including energy saving, carbon reduction, the circular economy, and sustainable development once more.

The circular economy is not a new concept. As early as 1989, British environmental economists David Pearce and R. Kerry Turner had introduced this term. In their book, they pointed out that after the Industrial Revolution, the linear production and consumption model of humans—“extraction, manufacture, use, and disposition”—was an economic model that treats the natural environment as a vast waste storage site. This economic model not only generated a substantial amount of waste but also required considerable costs to manage the generated waste, leading to waste of resources. In contrast, the circular economy was an economic development model that provided feedbacks. Based on the idea of continuous recycling and reuse of materials, it mitigated and reduced energy and material cycles by changing manufacturing processes and developing innovative business models, further achieving the goals of resource regeneration and sustainable development. According to the idea of the circular economy, there are no true “wastes” but only misallocated resources. The scope of the circular economy covers tangible and intangible products, ideas, models, behaviors, equipment, and services. At the end of 2015, the United Nations General Assembly set the Sustainable Development Goals (SDGs), aiming to achieve the 17 goals by 2030. Currently, these goals are regarded, by countries around the world, as guidelines and benchmarks for the progress of sustainability. To promote economic development and industrial transformation in Taiwan, the Executive Yuan proposed the “Five Plus Two” Innovative Industries Plan in 2016. The content includes five industries: the Asian Silicon Valley, the biomedicine, the green technology, smart machinery, and the national defense. In particular, the two transformation strategies - the circular economy and new agriculture – are included as the core of policy planning for these industries. The aim is not only to accelerate the upgrading of the five industries but also to drive the transformation of the industries as a whole, creating a new, sustainable and circular pattern of industries.

The circular economy can be divided into two circular systems: the industrial cycle and the biological cycle. For the circular system of industrial raw materials, renovation, re-manufacture, reuse, re-distribution, and repair are the main focuses. It involves rethinking the value of products and materials and reusing them with minimal processes, costs, and environmental impact, thereby improving value chains of products through new circular models. To implement these new circular models, cooperation with sectors of “the middle of the supply chain” is necessary. Plans need to be made in terms of aspects including upstream product design, material selection, product disassembly and recycling, standardization of parts and components, and manufacturing processes of secondary parts or raw materials so as to form a business model that provides services from an aspect of product supply. This is a longer-term ecological cycle system requiring more time to realize the benefits of the circular economy. In contrast, the circular system of biological raw materials mainly advocates the application of material flows in nature. In this model, biomaterials can return to nature and become resources again through repeated use, decomposition, extraction, bacterial fermentation, and other methods. All resources are fully utilized in the production process of the biological cycle. Through innovative thinking, new value is discovered in what originally appeared as useless waste, further creating new business opportunities. For example, pharmaceuticals, biodiesel, and other products can be extracted from biomass raw materials, rice husks, rice straws and other agricultural waste through biorefinery processing.

The concept of a circular economy being integrated into the agricultural industry leads to the idea of circular agriculture. According to domestic statistical reports, up to 5 million tons of agricultural waste including poultry manure, rice straws, mushroom grow bags, fishery residues, and tree branches are generated in Taiwan annually. If the agricultural integration and operation models can be reconsidered and redesigned, the production waste may be recycled and reused. This not only adds extra value to by-products that would originally be discarded but also allows the nutrients of biological materials and resources to be recovered for reuse or returned to nature. Regarding the implementation of circular agriculture, the Circular Taiwan Network has outlined three strategic concepts to for reference, aiming to make a change starting from value chains of products and drive innovative practices and solutions:

1. High-value cycle: To reach a balanced development of the environment and economy, bioeconomy is fully promoted. By utilizing natural resources such as water, air, sunlight, and soil while protecting biodiversity, the “two highs and three zeros” feature of agricultural products - high quality, high value, zero waste, zero emissions, and zero accidents - can be exerted.

2. Servitization of products: This involves transforming the assets required by agriculture companies and related processing enterprises from “outright ownership” to a “use of services” business model so as to reduce the financial burden on farmers and companies while improving flexibility and resilience in capital utilization and daily operations.

3. Servitization of products: This involves transforming the assets required by agriculture companies and related processing enterprises from “outright ownership” to a “use of services” business model so as to reduce the financial burden on farmers and companies while improving flexibility and resilience in capital utilization and daily operations.

The main purpose of the circular economy and circular agriculture is to reduce the waste and risks generated under “linear” thinking. By lowering resource consumption and dependence as well as improving resource efficiency, a positive effect can be brought to the environment and the livelihood of the citizens, thereby increasing industrial competitiveness, bridging the urban-rural divide, and implementing inclusive social values so as to provide industries in Taiwan with more resilient and sustainable development solutions.