Australian material flow analysis 
to progress to a circular economy

Summary report

Alessio Miatto, Heinz Schandl, and Josh Dowse 

March 2024



Australia is moving towards a circular 
economy, but more can be done

Australia is one of the world’s top 10 extractors of 
natural resources. It is the largest exporter of primary 
materials in absolute terms and, except for some 
Middle East oil exporters, per capita.1

However, there are environmental costs and limits to 
that extraction. To protect the environment, we need 
to extract and use those materials as efficiently and 
sustainably as possible. 

CSIRO’s analysis of material flows show that we are improving, 
but have further to go

Over the last decade, Australia has successfully reduced its 
material footprint, increased its circularity rate, and curbed 
air emissions. However, the Australian economy uses four 
times the materials to fulfil each person’s needs compared 
with the world average. This metric reflects Australia’s 
economic structure and reveals the opportunities of a 
more circular and sustainable economy.

This report suggests how:

• Extraction of virgin materials in Australia continues to 
increase, even if most of these materials are shipped 
abroad for economic benefit. Yet, Australia’s per capita’ 
material footprint’ has fallen by 16 per cent since 2015, 
and its greenhouse gas emissions by 7.4 per cent.
• The circularity of the Australian economy has increased 
marginally since 2015. However, it remains at half the 
global average and only 11 per cent of what we should 
be aiming for.
• We need to consider further efficiencies in the way we 
measure, process, and use our materials and products if 
we are to be part of a sustainable economy.


1 UNEP. (2023). Global Material Flows Database. From https://www.resourcepanel.org/global-material-flows-database 



The sustainable use of our natural resources matters

Using our natural resources linearly and inefficiently will 
result in further environmental costs of climate change, 
biodiversity loss, and pollution. Global annual extraction 
of raw materials has tripled from over 30 billion tonnes to 
over 106 billion tonnes in the last 50 years, causing over 
90 per cent of water stress and global biodiversity loss. 

If the most immediate of these challenges is global 
warming, then the sustainable use of our natural resources 
is essential. Material use is the single largest determinant 
of our energy use and emissions, responsible for over 
50 per cent of global warming, and so our biggest lever 
to reduce emissions. 

Adopting a circular approach also has multiple, significant 
benefits to the economy and wellbeing. Finding new ways 
to deliver products and services with a smaller footprint will 
drive innovation and wealth in Australia’s economy value 
chains. The re-use and recycling of goods will foster access 
to local jobs, second-hand goods, and new paths to equity 
and empowerment. These local supply chains are far more 
resilient to supply interruptions and other economic shocks 
than the capital-intensive global supply chains that favour 
virgin materials. Using non-virgin material as a valuable 
resource, along with renewable energy, will reduce the need 
and competition for global resources and so decrease the risk 
of geopolitical conflict. Our personal and public health will 
benefit from cleaner air, soil, and water. With less material 
being extracted and ending up in landfill, more land can be 
made available for other uses, especially near urban centres. 

As a fully developed economy with one of the world’s highest 
per capita wealth levels, Australia understands the need to 
free economic performance from unsustainable resource use.



Australia’s material use

A breakdown of what materials 
Australia extracts, imports 
and re-uses

The raw material flows through the Australian economy in 
2019 are best represented by the ‘Sankey diagram’ below 
(so named after the Irishman who drew one in 1898 to show 
the energy efficiency of a new steam engine). 

At the front end of the pipe (A), we extracted 2,587 million 
tonnes of virgin material from the Australian continent and 
its ocean shelves. To that, we added 119 million tonnes of 
imported material (mostly consumer goods) and another 
39 million tonnes that was re-used after recycling. From this 
total material input (B), we exported 1,459 million tonnes, 
leaving 1,287 million tonnes of materials processed for 
domestic consumption (C). Most of this was put to ‘energetic 
use’ (D) relying on fossil fuels to power machines and to 
feed ourselves and our animals with biomass. Together with 
371 million tonnes of mining waste (E), almost all of this was 
returned to nature in the form of solid, liquid, or gaseous 
wastes (F). The remaining 343 million tonnes were invested 
in buildings, roads, and other infrastructure. 

Figure 1 – Material flows through the Australian economy in 2019. The displayed units are million metric tons (Mt).



Assessing this material flow data with other things (the past, our population, and our economy), our findings suggest:

• Raw material extraction, though financially valuable, 
is having a rising impact on our environment. 
Of the 2,587 million tonnes of virgin material Australia 
extracted, 56 per cent was exported, including 
838 million tonnes of iron ore (three-quarters going 
to China) and 393 million tonnes of coal. There is 
no doubting the global economic benefits of these 
exports. However, the environmental impacts are 
under increasing scrutiny, particularly for fossil fuels. 
A strong record of managing these impacts and offering 
alternatives increases Australia’s competitive advantage. 
• The material footprint of the Australian consumer is 
improving. It seems that Australians are using more 
materials than ever before. The 1,287 million tonnes 
consumed in 2019 (C) was 24 per cent more than that 
consumed in 2015, while our population rose only 
6.6 per cent in that time. However, this does not tell 
the whole story. 


A complementary measure is our ‘material footprint,’ 
which looks at the materials we actually draw on and 
ignores whether its original extraction or processing 
occurs here or overseas. As it excludes the entire supply 
chain of exported materials, it is a clearer picture of what 
our households, businesses, and governments draw from 
the planet. If we wish, we can prefer to import products 
with a smaller material footprint or fewer products 
than before. The data suggest that we did: our material 
footprint fell from 1,123 million tonnes in 2015 to 996 
million tonnes in 2019 in absolute terms and from 46.9 
to 39.3 tonnes per capita.

• The material intensity of our economy is high and 
increasing. We now require 0.61 kg of materials for 
each dollar of GDP, slightly up from 0.56 kg/$ in 2015. 
Again, while Australia needs more material to produce 
each unit of wealth, much of this material is exported 
to other countries. We can reduce material intensity 
by processing raw materials more and exporting them 
for higher value.
• ‘Waste’ going back to the environment seems high 
at 999 million tonnes, but the comparative data are 
unclear. Our total waste emissions of just shy of a billion 
tonnes include metal processing waste of 371 million 
tonnes, liquid and solid waste of 101 million tonnes, 
of which biomass contributes 64 million tonnes, and 
construction of 21 million tonnes. Greenhouse gas and 
other air emissions are falling modestly, from 412 million 
tonnes to 404 million tonnes since 2015 and from 17.2 t 
to 15.9 t per capita.




The ‘circularity’ of our economy is only half the global average

At the bottom of the Sankey diagram (Figure 1) is the 
39 million tonnes we currently recycle. This mass is about 
half (51.1 per cent2) of all materials captured through 
municipal, industrial, and construction waste schemes. 
That’s not far off South Korea’s global standard of 57 
per cent – though it still means almost half this valuable 
resource is going to landfill.

When all our material flows are considered, they reveal an 
official measure of 3.7 per cent circularity for the Australian 
economy. In other words, for every 100 kg of resources 
we use, 96.3 kg are virgin materials. This result is a slight 
improvement from our 3.5 per cent in 2015 but well short of 
the 7.2 per cent global average. Albeit with a very different 
economy, the Netherlands has reached a world-leading 
24.5 per cent circularity.

However, this official measure of circularity is unduly 
negative. It is not possible for it to reach over 32.5 per cent 
because many materials are irreversibly transformed 
during use: once fossil fuels are converted to energy 
and emissions, they cannot be reconstituted. Based on 
that theoretical maximum, Australia has achieved some 
11 per cent circularity, implying a potential circularity ‘gap’ 
of 89 per cent that we should aim to close; see Figure 2 
below. That gap may never be closed entirely, as CSIRO’s 
2015 report on Australia’s circular economy estimated that 
only a 20 per cent circularity rate could be realistically 
achievable for our economy when considering today’s 
technology and progressive degradation of materials3. 

Figure 2 – Circularity indicators for all materials and four material subcategories for Australia in 2019. 

2 Note that this value comes from a waste input-output table from the Australian Bureau of Statistics. The official Australian recycling rate is 58.7%.

3 The seven considered in this analysis are housing, mobility, food, energy, communication, waste management, and ‘other’ (this last category includes systems 
like healthcare, education, governance, and so on).



Moving forward

Embracing circularity to benefit our economy, our health 
and the environment

Our material flow analysis highlights the current environmental performance of our economy and what we may do to 
improve it. These findings can inform Australian policy through the following:

• Better understanding of material flows. 
While emissions and GDP are end-of-system measures, 
the material flows that CSIRO measures represent 
the full system. Operating without those measures is 
akin to driving a car with a speedometer but no fuel 
gauge. Opportunities to keep that fuel gauge healthy 
by increasing circularity exist in mining, construction, 
manufacturing, agriculture, and resource recovery.
• Adding more value to raw material exports. If we are 
to deplete our natural resources, we should also seek 
to extract the maximum from them so that we have 
the national income to re-invest in our natural capital. 
Local processing would add national and regional income, 
jobs, and complexity to our economy. The National 
Reconstruction Fund and its aims to diversify and 
transform Australia’s economy is aiming to address this. 
• Focussing on housing and transport can make a real 
difference. Of all the ‘provision systems’3 on which 
we rely, housing and transport make up 53 per cent 
of our material footprint (food is responsible for 
another 22 per cent). Australia’s current policy focuses 
on packaging and consumer goods, yet their material 
volumes are small by comparison. Australia could, for 
example, incorporate more crushed concrete into new 
concrete, within quality and safety limits. It might also 
reverse our recent trends to larger cars and bigger 
homes by aligning mobility and housing to the needs 
of smaller families and providing better alternatives. 
Making parking spots wider does not foster a 
circular economy. 
• Consistent international standards for measuring 
material flow and circularity. Countries and 
regions have different measures, making comparing 
performance and setting meaningful targets harder. 
For example, Australia’s total waste has reached 39 
tonnes per capita, which appears high compared to 
Europe’s claimed 9 tonnes per capita. However, Europe 
does not count metal processing, legal waste disposal, or 
seeds and fertilizers spread through agriculture. 


Further work is needed to align and compare these 
figures and allow for the different make up of national 
economies. They might also consider the relative toxicity 
of waste streams: sand and gravel may be more easily 
absorbed by local environments than chlorine and 
phosphate, but they are measured as equals. 

Our research aims to 
measure and increase our 
understanding of material 
flow performance, resource 
use, and how to deliver 
improvements to support a 
circular economy in Australia.

Acknowledgments

This project is supported with funding from the 
Australian Government under the National Environmental 
Science Program. 



For further information

Environment

Alessio Miatto PhD
Senior Research Scientist
alessio.miatto@csiro.au 
csiro.au/environment

Read the full report at research.csiro.au/circulareconomy

Contact us

1300 363 400
csiro.au/contact
csiro.au