Fighting Food Waste Using the Circular Economy

Fighting food waste Using the Circular Economy

KPMG.com.au B Fighting food waste using the circular economy

© 2020 KPMG, an Australian partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (“KPMG International”), a Swiss entity. All rights reserved. The KPMG name and logo are registered trademarks or trademarks of KPMG International. Liability limited by a scheme approved under Professional Standards Legislation. Fighting food waste using the circular economy 1

Contributors and acknowledgements 2 Foreword 4 Introduction 5 Fighting food waste: The problem and opportunity 6 What is Circular Economy? 8 What does Circular Economy mean for food? 11 Around the world: Enabling Circular Economy to fight food waste 13 Current state of play in Australia 15 Circular Economy in Action 18 – Case study: Woolworths 19 – Case study: Yume 21 – Case study: Natural Evolution Food 23 – Case study: Tarac Technologies 25 – Case study: Mackay Sugar 27 – Case Study: Peats Soil 29 Fight Food Waste CRC 32 KPMG Circular Economy Services 33 Contributors 34 Looking for more inspiration? 34 Appendix 1: International enabling ecosystems 35

KPMG and the Fight Food Waste Cooperative Research Centre (CRC) have produced this report to highlight opportunities in the circular economy.

The Australian Fight Food Waste CRC brings together industry, research and the community to capitalise on Australia’s food waste opportunities.

The Fight Food Waste CRC is now the largest food waste research, development and extension public private partnership globally with 43 industry partners, eight university partners and eight state agencies participating in the cooperation. The CRC has funding to operate until 2028 ensuring focus and effort towards the National Food Waste Strategy, which has a goal of halving food waste by 2030.

Through three research and development programs, the Fight Food Waste CRC will REDUCE food waste across the supply chain, TRANSFORM unavoidable waste into innovative products and ENGAGE with industry and consumers to create behaviour change.

At KPMG, we believe that while growth is the fuel of development, how you grow matters. That’s why we strive to do things in a way that gives ‘now’ the win it needs while setting the future up for a win too.

It’s with this common purpose that more than 200,000 KPMG people in 153 countries and around 7,500 in Australia help companies plan sustainable pathways to value and growth. We offer deep expertise in Audit, Assurance & Risk Consulting; Deals, Tax & Legal; Management Consulting; Innovation, Solutions & Ventures; and tailored business services through KPMG Enterprise.

We foster a diverse, inclusive and forward-thinking culture and our employees give freely of their time and expertise to help fuel community wellbeing and growth that benefits us all.

Through our dedicated Circular Economy and Food and Agribusiness consultancy practices, KPMG specialists are focused on helping organisations grow more with a lighter impact on the planet.

Australia is a standout producer of high working together with the countries These three simple principles are at quality and safe food that the world leading minds on food waste reduction. the heart of the FFW CRC and can be wants yet we take for granted. We The FFW CRC aims to create value out directly linked to all of our research, produce enough food to feed 60 million of food waste through treating it as a development and extension projects. people in a country with a population of resource. Determining the best options 25 million, yet the United Nations Food for any resource stream is the role of I recommend this report to any and Agriculture Organisation reports our research community. Ensuring individuals or organisations wanting that 35% of this food grown for human that by the end of our term industry to fight food waste using the circular consumption is wasted. In 2019 the and consumers alike re-value surplus economy and note that the Fight Food Federal Department of Environment food is our primary aim. Ultimately Waste CRC and KPMG are here to help and Energy reported that this equates wasting food, no matter where in the you on your journey. to 7.3 million tonnes per annum, enough supply chain, must become as socially Dr Steven Lapidge to fill the Melbourne Cricket Ground to unacceptable as littering. Chief Executive Officer the brim near nine times. Shockingly Outlined in the following pages is Fight Food Waste Cooperative this occurs at a time when more than Research Centre 1 in 5 Australians are food insecure and information on food waste in Australia food charities are struggling to meet the and globally, principles of the circular rising need for food relief. We can do economy, as well as leading businesses better as a nation and adopting circular in Australia that have adopted circular economy principles to prevent food economy principles, some up to waste is the first step. 90 years ago, and have developed successful businesses that manage The Fight Food Waste Cooperative food waste. “ W inning the fight against Research Centre (FFW CRC) While the concept of the circular food loss and waste can commenced in July 2018 with a vision save Australia AUD$20 of an Australia without food waste economy may be new to many, the and a 10-year horizon. The benefits of principles behind it have long been billion per annum through achieving this vision are enormous. utilised by many human civilisations, increased industry Winning the fight against food loss such as the Romans, where recycling profitability and reduced of materials was common. Ultimately, and waste can save Australia $20 food insecurity, as well billion per annum through increased circular bioeconomy principles come industry profitability and reduced down to three key aims as highlighted as enhancing Australia’s food insecurity, as well as enhancing by the Ellen Macarthur Foundation: reputation as a sustainable Australia’s reputation as a sustainable 1. Design out waste and pollution. food producer.” food producer. The only way this 2. Keep products and materials in use. can be achieved is through industry, Dr Steven Lapidge, governments at all levels, and society 3. Regenerate natural systems. Fight Food Waste CRC

Food waste is a global issue costing over AUD$1.75 trillion annually1.

In an effort to reduce poverty and We can fight food waste using The World Resources inequality, encourage economic the circular economy Institute through growth and recognise environmental For businesses adopting circular Champions 12.3 has impacts, the UN’s Sustainable models, benefits include greater Development Goals include a target efficiency and profitability, less waste reported that the of halving food waste by 2030. and cost, better innovation and stronger average return on Acknowledging our own AUD$20 relationships with customers. investment is 14:1 for billion food waste problem, Australia the 700 companies has set a National Food Waste However, for many the concept of Strategy aligned to the UN target2. circular economy models and the shift involved in their analysis. required in mindset and business World Resources Institute3 Reducing food waste can have a processes can seem daunting. In positive benefit for the environment Australia, there is a need for greater and communities. Beyond this, by understanding of what circular economy adopting a circular economy approach means and how businesses are to reduce, reuse and recycle food successfully adopting circular models. waste, there is the opportunity for new business models to emerge and By fighting food waste through a financial benefits to be captured from circular economy model, there is a real what was otherwise being wasted. advantage to be gained for business, communities and the environments While the concept of circular in which we live, work and grow. economy is not new, challenges like resource availability, volatile growing conditions, pressures on supply and This report aims to: margins in food production, as well as 1. Highlight opportunities to address changing consumer preferences, are food waste through the circular forcing us to rethink inefficient and economy. wasteful linear models through our food supply chains. 2. Highlight international ecosystems enabling circular economies. 3. Showcase successful home-grown business models and initiatives to inspire action.

1. Boston Consulting Group (2018) Tackling the 1.6-Billion-Ton Food Loss and Waste Crisis – values modelled from FAO Global Food Losses and Food Waste (2011). 2. Arcadis National Food Waste Baseline (2019). 3. World Research Institute (2017) Champions 12.3 The business case for reducing food loss and waste.

Food loss and waste is a Food loss and waste per year global issue with estimated costs of almost AUD$20 Global: Global forecast (2030): billion annually for Australia and AUD$1.75 trillion ~AUD $1.75t ~AUD $2.2t worldwide. By reducing 1.3 billion tonnes 2.1 billion tonnes food loss/waste, there is the potential to not only Aust (2016-17): reduce financial losses, but ~AUD $20b also to capture financial 7.3 million tonnes gains through new markets and revenue opportunities, and improve brand value.

Food loss and waste from farm to plate ($Ab)

Production Post- Processing Distribution Consumer harvest & packaging & retail Global4 345 180 190 305 730 Australia5 1.6 1 1 5.2 +10

4. Boston Consulting Group (2018) Tackling the 1.6-Billion-Ton Food Loss and Waste Crisis – values modelled from FAO Global Food Losses and Food Waste (2011). 5. Arcadis National Food Waste Baseline (2019).

FAO Global Food Losses and food waste

Target 12.3 Halve global per 8% 20%–30% capita food waste of global greenhouse of food is lost or wasted Australia to halve emissions annually6 before reaching the consumer.6 food waste by 2030 (caused by gases released from It is inefficient to use financial resources, as well rotting food and also energy used as land, water, energy and labour to produce food in food production that gets wasted). that is ultimately wasted or lost.

Food waste is the highest growth opportunity for food and Food agribusiness in Australia based on 16 food and agribusiness Waste opportunities analysed by Food Innovation Australia Ltd

If food waste were a country, it would be the 3rd largest 28%–35% green house gas emitter behind China and USA6 forecast CAGR 2015- 20257

US $2.7 trillion/year By 2050, a circular economy for food could deliver up to US$2.7 trillion per annum of benefits. $700b resulting from reduced waste and value-added by-products, and the remainder from environment and health benefits.8

6. FAO Global Food Losses and food waste. 7. Size of the prize – An overview of 16 global opportunities for Australian food and agribusiness, FIAL November 2017. 8. Ellen MacArthur Foundation – Cities and circular economy for food.

What is Circular Economy?

The circular economy is an economic 6 business benefits of the circular Five principles for a circular economy model that aims to avoid waste and economy for SMEs9: include:10 to preserve the value of resources 1 Reduced exposure to rising and Principle 1: (raw materials, energy and water) the volatility of resource prices for as long as possible. Products Waste no longer exists 2 Thinking circular stimulates and materials are continuously (re) innovation Principle 2: circulated – as opposed to a linear model in which they are discarded 3 Creates a green image Biological materials are renewable, as waste after use. 4 Opens new markets and technological materials not and should opportunities for growth therefore be recycled

5 Increased customer loyalty and Circular Principle 3: more stable revenue streams Reduce. Reuse. Recycle. Try to reuse the product as a whole, 6 Environmental benefits through if that is not possible parts of the vs reduced use of raw materials, product, and if that is not possible energy, and fresh water. Linear recycle the materials Take. Make. Dispose. Principle 4: First repair, then reuse, then refurbish and then recycle It’s good for the environment and our communities. It’s good for business. Principle 5: Make use of renewable energy

9. Let’s help SMEs to go circular, 2018 https://ec.europa.eu/environment/sme/pdf/Training%20materials_English.pdf 10. Guided choices towards a circular business model, https://www.greencycle.si/wp-content/uploads/2018/03/guided_choices_towards_a_circular_business_model.pdf

Master class introduction to the circular economy Fighting food waste using the circular economy 9

There are a number of global Introduction OverviewFigure of 1: overviewglobal of globalsustainability sustainability mega mega forces (source: forces KPMG (2012), expect the sustainability mega forces that are unexpected) The objective of this module is to introduce the concept of circular11 economy driving a shift towards circular . Climate Energy and Material Water Population and explain why circular economy is a relevant concept for SMEs. As stated Change fuel resource scarcity growth in the general introduction,Challenges non-renewable like resource natural resources scarcity, are becoming scarcity scarce mostly due to: thegrowing growing global global population,population, the rapidly growing wealth in upcoming economies andreducing the rapidly global reducing stocks of global naturalstocks of these resources (e.g. oil, natural gas and rare metals). This has resulted in rising prices and increased priceresources volatility and. This environmentalforces businesses, decline including SMEs, to use these resourcesare driving more efficientlythe need. Thefor change. concept of the circular economy provides a way of thinking on how to increase resource efficiency. Rising Urbanization Food Ecosystem Deforestation “A circular economy is middleclass security decline based on the principles The global business environment is more complex and fast-moving than everof designing out waste and pollution, keeping Globalization, digital connectivity, accelerated consumption and disparate prosperity have combinedproductswith ecological and materials decline, a lack of global sustainability governance and resource scarcity to transform the playing field for businesses. As ina result,use, today’s and globalregenerating business environment is Impacts on business more complex, uncertain,naturalvolatile and systems.” fast-moving than ever before.

In 2012 KPMG identifiedEllen trends MacArthurwhich have significantlyFoundation changed and will continue to change the global business environment: globalization, digital connectivity, accelerated consumption, disparate prosperity, ecological Resource Price Physical and Changing decline and resource scarcity. In addition KPMG identified global New constraints increases & weather customer regulations on sustainability mega forces that in the nearby future will have a strong volatilty changes preferences influence on the business environment and shall force the global business production community to become more sustainable (see: figure 1, lefthand side). Source: KPMG, Let’s help SMEs to go circular, page 10.

© 2018 KPMG N.V., a Dutch limited liability company, is a member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative (‘KPMG International’), a Swiss entity. All rights reserved. 10 According to the Earth Overshoot Earth overshoot day: a call to action Days calculation, if the world’s population lived like Australia did in 2019 we would have used more ecological resources than the planet is able to renew in a year by 31 March. That means we would need 4 earths if everyone in the world acted like Australians.12

The global date the world consumes more than the annual ecological resource renewals is 29 July 2019. In 2018, the date was 1 August. If food waste was cut in half worldwide, the Overshoot Day would be moved back by 10 days.13

Source: Overshoot Day (2019), Country Overshoot day.

11. KPMG (2012), Expect the unexpected 12. Overshoot Day (2019), Country Overshoot day, https://www.overshootday.org/newsroom/country-overshoot-days/ 13. https://www.un.org/sustainabledevelopment/sustainable-development-goals/

With the growing strain on resources, In addition to the benefit a circular they are becoming more and more model can have in reducing food waste difficult and costly to access. The and enabling a shift towards zero linear model of “take, make, dispose” hunger, businesses and governments is not economically or ecologically are recognising the potential of the sustainable. The pressure on resource circular economy to drive business access and environmental impact competitiveness, sustainable is driving a focus on the benefit of a economic growth and job creation circular model for reducing, reusing through waste to value initiatives. and recycling. The goal of circular is to unlock maximum value from inputs and For businesses going circular, outputs for the longest possible time. benefits include greater efficiency and profitability, less waste, reduced Shifting towards a circular economy cost, better innovation and stronger is one of the most important relationships with customers and transformational challenges supply chain partners.14 In contrast government, companies and to the current ‘take-make-dispose’ communities are facing. It is also a model, the concept of circular economy key opportunity – enabling progress is widely recognised to enable more towards the UN Sustainable sustainable business models through Development Goals including halving increased resource efficiency. food waste by 2030 and zero hunger, improving resource efficiency (land, energy, water) and creating the potential for new economic models.

UN SDG Goal 12 target 12.3: “By 2030, halve per capita global food waste at the retail and consumer levels and reduce food losses along production and supply chains, including post-harvest losses”

UN SDG Goal 12 target 12.5: The UN Sustainable Development Goal 2 – Zero Hunger and 12 – “By 2030, substantially reduce waste generation Sustainable Consumption and through prevention, reduction, recycling and reuse” Production set targets to fight food waste.15

14. KPMG (2019) Getting ahead in the circular economy, KPMG. 15. https://www.un.org/sustainabledevelopment/sustainable-development-goals/

In its simplest form, the circular What are the farmers doing to reduce waste?16 economy principles of reduce, reuse and recycle apply to food as:

1 Reduce Decrease volume lost to waste

2 Reuse Redistribute surplus edible food

3 Food Recovery Hierarchy Recycle Food recovery hierarchy Creating new value from food

waste and inedible by-products M Source Reduction & Reuse o st P Reduce the volume of surplus

re food generated fer

r The ‘Food Recovery Hierarchy’ notes ed Feed Hungry People that to address food waste with Donate extra foods to food banks, a circular mindset, the preferred soup kitchens and shelters outcome is to reduce the volume of surplus food generated or reuse it. Feed Animals Divert food scraps to animal feed Least preferred is sending the waste to landfill. Industrial uses Provide waste oils for rendering and Developed by FoodDrinkEurope, the fuel conversion and food scraps for illustration on the following page digestion to recover energy highlights the opportunities from farm Composting to consumer to prevent and reduce Create a nutrient-rich soil amendment food waste through circular economy Least Preferre models. To fight food waste through Landfill/Incineration circular, it is key that the agri-food Last resort to disposal value chain work together in finding ways to keep food fresher for longer d

16. https//www.rabobank.com.au/savings/2019/03/26/05/27/financial-healthbarometer-food-waste-infographic-2018/

through improved storage conditions Food brands, retailers, chefs, and nutrients into the soil. Marketing and and logistics, creating products other food providers have a major branding is also important to tell the from all harvested produce, seeking influence on what we eat. In circular story of the food to consumers so that opportunities to convert waste into models, they have an important role in benefits such as increased margins energy, feedstock, fertiliser or other designing food products, recipes and and new markets can be realised.18 products, and in informing consumers menus that are healthy for people and about the process from farm to plate, the environment. This extends to food the impact of food waste, portion packaging that preserves food and is sizes, and storage instructions.17 also compostable so it be recycled as

A Circular Economy for the food and drink industry

Source: https://circulareconomy.fooddrinkeurope.eu/

Governments, universities and and its use in circular business EU Circular Agenda 2024 research bodies, and financial models. Universities and research institutes also have a role in circular as bodies can also include circular Product Environmental Footprint stakeholders in the food and agri value principles and food systems in course voluntary disclosures on labels by chain. For example, Governments curricula. Finally, financial institutes 2021, telling the whole lifecycle can influence transitions to circular could incentivise circular economy impact of the product will highlight through policies, incentives and business models by directing capital circular businesses/products from access to practical support and towards businesses with circular exploitive/wasteful products. training. Innovation hubs connecting models or working towards circular.18 government, research and industry offer the ability to fast track research

1 7. https://circulareconomy.fooddrinkeurope.eu/ 18. https://www.ellenMacArthurfoundation.org/explore/food-cities-the-circulareconomy

Western Europe, Japan and China There are five core roles for government in enabling and encouraging have led the way in enabling and circular economy models:20 encouraging circular economy models. These regions demonstrate 1 Create a vision for the Region, State and Nation that government has a key role to play in providing incentive and support 2 Engage with stakeholders for businesses to adopt circular 3 Provide economic incentives business models. 4 Influence urban management levers Likewise, investment and financing models can enable a circular 5 Legislation and regulation economy through promoting and rewarding those pursuing economic • Empowering consumers – active engagement of citizens opportunities connected with circular in changing consumption patterns models and thinking. For example, • Information on products’ durability and reparability can also since 2014 Rabobank NL has shift purchasing decisions towards more sustainable choices been driving the Circular Business • Consumer protection against false environmental claims etc. Challenge, in partnership with CSR Netherlands and KPMG. Over 50 businesses have participated in the challenge which aims to map opportunities for circular economies in regions and bring entrepreneurs together to develop new ideas/ solutions and a circular action plan. The challenge inspires action and helps businesses to get started on their circular journey.19

19. https://www.rabobank.com/en/about-rabobank/in-society/sustainability/circular-economy/rabobank-circular-economy-challenge/index.html 20. https://www.ellenmacarthurfoundation.org/assets/downloads/CE-in-Cities_Policy-Levers_Mar19.pdf

The below provides a snapshot of Government activity and frameworks around the world aimed at enabling and promoting a shift toward circular. More information is provided in Appendix 1.

EU UK France • EU Circularity Agenda 2024 • UK Govt Food Waste Measurement • ‘National Pact to Combat Food Waste’ • Product Environmental Footprint Roadmap - to halve food waste by 2030 in 2016, France made a commitment to reduce the phenomenon by half by 2025 • EU Monitoring Framework for the • The Courtauld Commitment – voluntary Circular Economy agreement aimed at the UK grocery • ‘Loi Garot’ The first national law against sector food waste particulary at the retail level • First analysis of Europe’s progress in achieving a more sustainable, • The UK Plastics Pact to create a circular economy for plastics regenerative economy Japan • EU Strategy for Plastics in a Circular • ‘Basic Act on Establishing a Circular Economy Finland Society’ enacted law in 2000 • Resource-related policy goals • Circular Economy roadmap to be a • Food Loss Reduction Promotion Bill with targets and indicators carbon-neutral circular economy by 2025 • Food industry recycles about 85 per cent • ‘Let’s help SMEs to go circular’ project • Business Finland and the Ministry for of its food waste Foreign Affairs have make the circular economy part of Finland’s country image. Netherlands China • Initiatives to building capabilities in • Goal to be completely circular economy sustainable food systems, bio-based • Circular economy effort commenced by 2050 – ‘A Circular Economy in the economies and digitisation (data and 20 years ago Netherlands by 2050’, new technologies) • Circular Economy Promotion Law • Actively seeking policy and incentives • China and the EU signed a Memorandum for businesses to go circular and working of Understanding on Circular Economy Scotland to remove legislative roadblocks Cooperation • Food for the Circular Economy policy brief • Target to reduce foodwaste by 1/3 by 2025 • Food Smart Facility - The Netherlands, • ZeroWaste Scotland USA Rabobank, the World Bank, IFAD, FAO • £70 million for a Circular Economy and the Rockefeller Foundation Investment Fund and Service to support • U.S. Food Waste Challenge small and medium-sized enterprises • National target to reduce food waste (SMEs) by 50% by 2030 • Circular economy strategy – • Food Loss and Waste 2030 Champions ‘Making Things Last’ • Joint agency agreement ‘Winning on • P roposed Circular Economy Bill to drive Reducing Food Waste Initiative’ towards net zero carbon emission by 2045

Solving the AUD$20 billion issue The strategy outlines four priority The Australian Futures Project 2018 of food waste in Australia will take areas to be pursued to meet this – Wasting the Future noted that a collaborative approach between objective: government intervention is required supportive government initiatives, to reduce the levels of waste sent entrepreneurial spirit, active industry 1. Policy support to landfill. The approach to waste in participation, applications of disruptive 2. Business improvement Australia is linear with a focus on technologies, and input from 3. Market development recycling and landfill with significant academia and significant consumer 4. Behaviour change. volumes of hard waste sent offshore. behaviour change. This practice has been impacted by Since the launch of the National Food regulatory changes in China, India Momentum on the importance solving Waste strategy, Food Innovation and Australia, restricting the export of food waste has grown over the past Australia Limited has been formulating Australia’s recyclable waste streams. and is rapidly transitioning from the national implementation plan, niche to mainstream. The 2017 War monitoring and evaluation framework For traction to be made, there needs on Waste, a four part documentary which is due to be released later this to be a greater focus on reducing aired on the ABC, catalysed the issue year. This framework looks to bring waste rather than recycling or reusing 22 into the mainstream for consumers, together industry, government and it. This concept is aligned with the leading to sales growth in products academia to create business solutions food waste hierarchy that identifies such as Evolution’s Green Banana and supporting policy frameworks to the preferred option as reducing the Resistant Starch powder and the drive change. volume of surplus food produced. introduction of new policies and process at retail, for example In May 2019, the Federal Government Momentum has also been building Woolworth’s Odd Bunch range. provided AUD$1.6m in funding to across state governments with a Planet Ark to establish a National number launching (or due to launch) In 2017 the Federal government Circular Economy Hub and their circular economy policies and launched the National Food Waste Marketplace which aims to be the action plans in 2019. Strategy outlining a framework for “B2B’s ‘eBay’ to enable the circular action towards halving Australia’s food economy and match buyers and waste by 2030, a goal aligned with sellers of waste resources.21 the UN Sustainable Development In October 2019, Yume’s Katy Barfield Goal 12.3. The National Food Waste won an Australian Financial Review Strategy was updated in 2018 to 100 Women of Influence award in the include consideration of circular Business and Entrepreneur category economy principles. for her leadership and innovation in the food waste space.

21. https://planetark.org/documents/doc-1864-circular-economy-hub---program-information 22. http://files.australianfutures.org/Wasting-The-Future-Final-Report-PDF.pdf

South Australia: Victoria: defines the State Government’s role Through circular economy principles The State has commenced shifting in implementing circular economy South Australians are transforming towards a circular economy and principles across NSW and provides the way the economy uses and is currently developing a circular principles for implementing circular values resources. Top of the agenda is economy policy and action plan to economy in the Government’s 27,28,29 reforming household waste, reducing be released in late 2019 through the processes and decision making. food waste through developing Department of Environment, Land industry solutions, reforming Water and Planning.25,26 In September Queensland: packaging and single use items, 2019 the Victorian Government hosted In 2019, the State Government developing the circular economy in Global Table in Melbourne, bringing defined its waste vision and business and preparing for waste together leading international and strategy towards a zero-waste resulting from natural disasters.23 Australian agrifood participants under society that leverages circular one umbrella to create a conversation economy principles.30 Earlier this In October 2019, the State on solving the biggest food year Queensland became home to Government launched an AUD$11m challenges and creating tomorrow’s Australia’s first Circular Economy research consortium for Agricultural breakthroughs. A key focus of (CE) lab with an aim to help drive the Product Development led by the the event was achieving the UN state’s transition to a new low-carbon University of Adelaide, including a Sustainable Development Goals and and circular economy, delivering AUD$4m Government Grant. Up to food waste and sustainable packaging opportunities for industry and more 40% of SA’s primary production can was a key focus of the event. jobs for Queenslanders. A key focus end up as waste. The Consortium of the CE Lab is to consolidate brings together 18 partners and is industry, research and government focused on turning this waste into New South Wales: partnerships and expertise to identify high value products for markets such Released its Circular Economy Policy and deliver circular economy pilot as pharmaceuticals, cosmetics and in Feb 2019 – Too Good to Waste. projects. To date, the CE Lab has had packaging.24 The policy provides direction for circular with seven guiding principles, five projects including two focused on

23. Green Industries: https://www.greenindustries.sa.gov.au/circular-economy 24. https://www.adelaide.edu.au/newsroom/news/list/2019/10/22/making-high-value-products-from-agricultural-waste 25. https://engage.vic.gov.au/circulareconomy 26. https://www.environment.vic.gov.au/sustainability/circulareconomy 27. https://www.epa.nsw.gov.au/your-environment/recycling-and-reuse/response-to-china-national-sword/circular-economy-policy 28. https://engage.environment.nsw.gov.au/circular 29. https://www.epa.nsw.gov.au/-/media/epa/corporate-site/resources/recycling/19p1379-circular-economy-policy-final. pdf?la=en&hash=F80151EA9C2C3E27BA889D15D18041CDF7A4D25A 30. http://statements.qld.gov.au/Statement/2019/4/17/queenslands-shift-towards-a-circular-economy-steps-up-a-gear

the food-agri supply chain. One looked The Fight Food Waste CRC, now the at eliminating soft-plastics from food largest food waste R&D Public Private production and another at repurposing Partnership globally with AUD$63m waste streams from the agri-food cash, AUD$57m in kind, 50 industry value chain.31 and 10 research partners is also a key mechanism to bringing together Queensland’s Chief Entrepreneur government, academia and industry and Co-chair of World Economic to design and implement solutions to Forum Circular Economy working reduce waste. group, Leanne Kemp, is encouraging Queensland to become one of the Whilst momentum is building with WEF Lighthouse Circular Economy Federal and State Government examples. policies and initiatives directed towards circular economy and food Western Australia: waste, significant collaborative work from players across the food value Waste Avoidance and Resource chain is required to develop circular Recovery Strategy 2030 provides a solutions towards tackling the issue long-term strategy and targets for the of food waste. state for continuous improvement of waste management. The strategy outlines the vision for Western Australia to “become a sustainable, low-waste, circular economy in which human health and the environment are protected from the impacts of waste”, and the targets and enablers (knowledge, infrastructure and incentives) to achieve this vision.

Tasmania: In June 2019, the Government released a Draft Waste Action Plan for consultation. The plan proposed, among other targets, the reduction of organic waste sent to landfill by 25% by 2025 and 50% by 2030 and the introduction of a waste levy by 2021 (Tasmania is one of the few states without a waste levy in place).32

31. http://statements.qld.gov.au/Statement/2019/2/25/australian-first-circular-economy-lab-opens 32. https://dpipwe.tas.gov.au/environmental-management/waste-action-plan

Industry also has an important role to play in tackling food waste.

Throughout the agri-food supply chain Agriculture Post-Harvest Processing Distribution Consumption there are opportunities to reduce, Horticulture waste Storage and Food manufacturing Logistics Food waste reuse and recycle waste. There are – Unwanted crops transport waste waste – Losses during – Households – Losses during – Spillage, – Wineries, packing/transport – Retailers a number of businesses that are harvest spoilage, breweries – Supermarkets, – Restaurants & contamination catering PUSH – Crop damage, – Canneries, food wholesalers applying the principles of circular – Large facilities disease, natural processing & services disasters – Out of spec (e.g., economy to tackling food waste (e.g., airports, confectionery) Animal-based hospitals) and achieving financial benefit. – Abbatoirs, waste slaughtering – Large animals, waste The below diagram developed by pigs, poultry by Fight Food Waste CRC highlights products – Fish bycatch the opportunities to create value – Losses at pasture from food waste by applying circular economy principles to the agri-food Mechanical Chemical Thermal Biological value chain. Mechanical Chemical Thermal Biological

conversions conversions conversions conversions ENABLE As the focus on food waste and – Dewatering – Compositional – Gasification – Anaerobic – Filtering (e.g., analysis – Pyrolysis digestion circular models grows, so do the micro- & ultra-fil – Standard solvent – Incineration – Fermentation new businesses and solutions. tration) extraction – Hydro-thermal – Composting – Centrifugation – Other solvent liquefaction – Vermiculture The following section provides free extraction – Insect processing a spotlight on some Australian companies that are putting circular economy into action to fight food Cropping Industrial High-value Feeding Feeding waste, and are benefiting from inputs products products animals Humans through new products, new markets, Bulk Materials Energy Food system Animal feed Rescued food – Compost – Gas products – Re-processed – Fresh food and new business models. – Ferlitiser – Diesel & ethanol – Nutraceuticals waste Re-processed food PULL – Char – Hydrogen – Starch & fibres – Re-direct waste – Soups – Electricity – Other additives – Black soldier fly – Fermented foods Materials (e.g., colourants) larvae – Fibers Non-food products – Biocomposites – Pharmacological agents – Polymers – Fibers

Source: Fight Food Waste CRC.

Case study

Woolworths

Description of business With these programs in place, Date Established Woolworths Supermarkets is Woolworths has recorded an Australia’s largest chain of grocery average year-on-year reduction 1924 stores. It has 995 stores operating of eight per cent in food waste sent around the nation with around to landfill over the past three years. 115,000 staff in stores, distribution Location centres and head office. Business model – National Circular initiatives The organisation purchases 96 per The chain has enlisted not-for-profit cent of fruit and vegetables and partners to redirect food still fit 100 per cent of its fresh meat from for human consumption into the Australian farmers, and serves 28 Business type mouths of those who need it the million customers a year. ASX listed, most. Any food that is no longer fit Grocery store chain for human consumption is diverted Driver for establishing to farms to be used as animal feed circular economy model or commercial organic composting. Collectively Australia wastes Company size AUD$20 billion worth of food a The company’s Stock feed for EDITDAR year, which is estimated to be Farmers program has been running AUD$6,063m 40 per cent of all food grown for over 10 years. and manufactured in Australia Woolworths have also partnered for consumption in this country. Number of employees with Tribe Breweries to create a Woolworths is committed to help circular economy beer – Loafer. This reducing that number. 115,000 limited edition pale ale has been In a bid to tackle the food waste created with more than 350kg problem Woolworths announced of left over bread and each sale in June 2019 that 100 per cent of represents a meal being delivered its supermarkets now have an to vulnerable Australian’s through active food waste landfill diversion its partnership with Feed Appeal. program in place. These programs All money raised through the include –rescuing surplus fresh purchase of Loafer beer goes food and distributing it to hunger directly to community food relief relief charity partners, donating stock feed to farmers and sending the waste for commercial organic composting.

Case study

charities to supply ovens, freezers, Woolworths have invested heavily in cool rooms, transport and other their team members to ensure that Key benefits of Circular vital infrastructure to help them they have the education, training, Economy activity store, cook and share meals, which resources and equipment to better 1. Redistributed 350kg of bread themselves are often cooked from identify and divert surplus food that from landfill to be used in rescued food to meet the growing can no longer be sold away from brewing beer, profits from which demand for food relief. landfill and toward the most beneficial are donated to Feed Appeal stream – be it food rescue for hunger Loafer’ is available exclusively at BWS relief, farmer donations for animal 2. Eight per cent reduction in food and Dan Murphy’s stores across feed or commercial composting. going to landfill over the past Australia. For every six pack sold three years. ($25), 50 cents is donated to Feed They are also the only retailer to 3. Over 55,000 tonnes of food Appeal which equates to one meal. have joined the Fight Food Waste diverted from landfill For every carton sold ($73), $2 is Cooperative Research Centre. donated to Feed Appeal, which can The Fight Food Waste Cooperative help to feed a family of four. Research Centre brings together Advice for others in adopting industry, research and the community circular Business results to capitalise on Australia’s food 1. Develop partnerships to create With these programs in place, waste opportunities. There are three a circular value chain Woolworths has recorded over research and development programs 55,000 tonnes of food being diverted which include reducing food waste 2. Re-examine the concept of from landfill, and 10 million meals across the supply chain, transforming “value” to build the business have been delivered to Australians in unavoidable waste into innovative case need across the country. high-value co-products, and engaging 3. Be aware that circularity is not with industry and consumers to ‘one-size-fits-all’ To date over 750 farmers and create change. community groups from around the country have joined the Woolworths How to get involved / where to Stock Feed for Farmers program and learn more: last year Australian farmers received Visit the Woolworths website for more than 33,000 tonnes of surplus more information - food from Woolworths that is no https://www.woolworths.com.au/ longer fit for human consumption shop/discover/community/food-waste but suitable for livestock feed or composting. Element/s of the food hierarchy model addressed: Where to next M Source Reduction Woolworths has a strong o s t & Reuse commitment toward Food Waste Pref er Feed Hungry r and has committed to working ed People towards zero food waste to landfill. Feed Animals There is a desire to look at further opportunities to re-purpose products Industrial uses destined for landfill. Le Composting a s t P r e f Landfill/ e r re Incineration d

Case study

Yume

Description of business Business model Yüme is an award-winning social Yüme collects a commission enterprise that created the world’s on products sold and generates leading B2B online marketplace other income through marketing for quality surplus products that partnerships and premium service Date Established connects Suppliers with Buyers. packages. Yüme are the Airbnb of surplus food. 2016 Business results Driver for establishing Yüme is servicing buyers and circular economy model suppliers nationwide. The company At Yüme we are building a more experienced threefold growth Location transparent and connected food in the past 12 months and have Melbourne industry – forging new channels to returned $4.5 million to Australian market for the 4.1 million tonnes of farmers and manufacturers though food going to waste every year in the sale of 1.3 million kilograms the commercial sector in Australia. of food, saving an estimated Business type Yüme partners with businesses 2,600 tonnes of CO2 emissions Social Enterprise to do things differently leveraging with embodied water value of 85 technology to ensure edible food million litres. realises its maximum resource value – to be sold and consumed. Where to next Yüme suppliers include Kellogg’s, Company size Yüme’s vision is a world without Mondelez and Unilever and our $2-5 mil turnover waste. The current priority is to buyers are the likes of Sodexo, scale locally (volume of suppliers Spotless, Accor and discount and buyers transacting on the retailers. platform), expanding further into Number of employees the primary produce segment, before taking our solution (platform 8 and know-how) to international markets.

Case study

There are also opportunities to deploy our technology expertise to transform Key benefits of Circular supply and demand optimisation Economy activity beyond surplus food. 1. Optimise resource use – stop Yüme is a commercial solution that the take-make-dispose mentality operates at the top of the food waste 2. Triple bottom line payback hierarchy – improving the bottom line 3. Promotes collaboration for both suppliers and buyers.

Element/s of the food hierarchy Advice for others in adopting model addressed: circular

M Source Reduction 1. Don’t do it alone – partner and o s t & Reuse Pref collaborate

er Feed Hungry r ed People 2. Act now or you’ll lose market share (avoid the cost of inaction) Feed Animals 3. Educate your stakeholders Industrial uses

Le Composting a s t P r e f Landfill/ e r re Incineration d

Case study

Natural Evolution Food

Description of business In 2010, Rob accidentally drove Natural Evolution Foods over a hand of lady fingers and he converts green bananas that saw what looked like dust. This were previously classed as food drove him to ask and research waste into nutritional gluten-free could this be a flour? super foods, along with health After suffering mild coeliac supplements, baking products, Date Established symptoms and not being beauty products and ointments, 2010 impressed with the majority of equine supplements. gluten free products on the market Rob and Krista began producing a Driver for establishing small batch of 6kg of banana flour circular economy model per week sold through his family’s Location For many years Rob and his family café. Green bananas are very North Queensland were among the largest banana difficult to peel making the work growers in Australia, specializing in labour intensive and slow. a variety known as Lady Fingers. When the bananas were too bendy, The first week it took the entire Company size too straight, or too big they didn’t week for the gluten free “banana SME meet supermarket guidelines so flour” to sell. The next week the were sent to waste. Each week, flour was sold out by Wednesday. more than 450 tonnes of green The following week, it was sold Number of employees bananas were being wasted in out Monday morning and before North Queensland and at least 5 they knew it, word had spread and tonnes per week was from Rob orders were being phoned in and 9 and Krista’s farm. demand was months ahead of their ability to supply. But the fruit was good for eating Waste use and packed full of nutrients. In Business model ‘out-of-spec’ horticulture fact, cattle would break fences – bananas, sweet Seeing an opportunity in the and wallabies would gather to eat potatoes market, and with dedication and the wasted green bananas. The innovation, Rob designed the first wallabies would actually reach over and only peeling machine in the Products ripe, yellow bananas just to eat the prebiotics, GF flour, world. This increased output to green ones. cake mixes, packaging, approximately 300kg per week vodka which also sold out weeks and often months in advance.

Case study

In August 2014 Natural Evolution What began as a purpose and use Foods received a grant from for tonnes of wasted bananas each Key benefits of Circular Commercialisation Australia to assist week has evolved into a new market Economy activity (reduce, in building the world’s first and only for all growers. reuse, recycle) pharmaceutical grade banana flour 1. Value-adding process for green factory – a 950 square meter food Business results banana waste processing factory. Natural Evolution has opened up a 2. Reduced waste to landfill Since finishing the facility in late new market for previously wasted 3. Access to new national and 2017, the business is able to produce bananas and sweet potatoes. Rob and international markets and approximately 8 tonnes of banana Krista now run the first and biggest customers flour each week. Natural Evolution commercial production of banana Foods sources green bananas and gold flour in the world. sweet potatoes from the Tablelands For his enthusiasm and vision Rob Advice for others region. It takes 10 tonnes of banana has received numerous accolades waste to produce 1 tonne of flour 1. Be inquisitive – just because for his inventions and food processing which is processed on site using the it has always been that way, techniques. Krista has also been patented ‘Nutrolock’ technology. doesn’t mean it should always recognised receiving the title of be that way. the 2018 Agrifutures Rural Woman Not only did they need to invent 2. Don’t be afraid to say no – of the year. and build the peeling, processing surrounding yourself with the and drying equipment for a product Natural Evolution Foods began by right team that aligns with your that had never been created before transforming waste bananas into company and personal values. – which took more than five years a highly nutritious food source and 3. It’s a journey – the goal posts – they also had to find and educate is now revolutionizing the banana often shift and change and their market. industry where bananas are being you need to be able to pivot to It was a rather unconventional grown for the sole purpose of flour ensure you get the goal in! approach to finding and establishing production. communication to the market. Over many years of research and listening Where to next? Element/s of the food hierarchy to people from all over the world Natural Evolution Foods is now model addressed: the internal Natural Evolution team considering how their patented M Source Reduction was ready to officially launch their o processing technology can be used s t & Reuse commercial products. for other wasted foods in the industry. Pref er Feed Hungry r People Natural Evolution Foods product range They are also working towards a ed has now expanded to include cake larger facility based in Walkamin due Feed Animals and baking mixes, gold sweet potato for completion early 2021. Industrial uses flour, protein powder, beauty products Le Composting and healing ointments, and fiber a s t P supplements for horses. r e f Landfill/ e r re Incineration Products are available to customers d around the world via Natural Evolution’s website and also in stores across Australia, as well as in New Zealand, Japan, England, Singapore and Canada.

Case study

Tarac Technologies

A closed loop system creating value from solid and liquid winemaking residuals

Date Established Description of business clients and supply chain partners Tarac Technologies takes waste to adopt sound sustainable 1930 created during the winemaking management practices. process and transforms it into Tarac’s motto is: value added products for local and Location export markets. SA & NSW Through Tarac’s closed loop system, the company also ensures minimum environmental impact and waste from its own processing Number of employees by-products. Business model 60 Tarac’s sustainable system starts Driver for establishing circular economy model on the land in the form of grapes and finishes on the land in the form Tarac Technologies was established of stock feed products, irrigation Waste used in 1930 by ex-CSIRO scientist water and soil conditioners. Waste wine industry, Alfred Allen at his home in the from winemaking is transported grape marc heartland of the Australian Wine to one of Tarac’s 4 sites, located Industry – the Barossa Valley, South near winemaking regions in South Australia. Australia and New South Wales, Products value adding to solid From the beginning, Tarac has been for treatment and value-adding and liquid winemaking committed to sustainability and processing. residuals environmental resilience of the Tarac treats over 135,000 tonnes Australian Wine Industry. This is of grape marc, more than 40 reflected in the company’s vision million litres of liquid waste and and core values as well as ISO approximately 7,000 tonnes of solid 14001 environmental management waste annually; about 70 percent system accreditation. Tarac of the solid and liquid residuals works to proactively manage and produced by the Australian wine implement resource efficiency industry. measures and also encourage their

Case study

Solid residuals are treated to recover With an eye on the environment grape alcohol, brandy spirit and and the Australian wine industry’s Key benefits of Circular tartrates. These products are returned waste challenge, Tarac’s business Economy activity to the wine industry. Liquid residuals solves major waste disposal and 1. Removes a waste disposal from wineries are treated at a waste environmental issues and in doing problem for wineries saving water treatment plant co-owned this contributes to the long term money and reducing their by Tarac and a major local winery sustainability and resilience of the environmental liability in Nuriootpa. The facility, known as Australian wine industry. the North Para Environment Control 2. Valuable products are created for the use of the Australian (NPEC), is considered to be one of Where to next the most efficient and effective waste wine industry delivering a 1. Driving further efficiency gains water treatment plants in Australia. sustainable revenue stream Treated water is used to irrigate local 2. Extracting more value from for Tarac vineyards and pasture near Tarac’s raw materials 3. Through recycling water, Tarac is Samuel Road, Nuriootpa site, and 3. Responding to rising costs able to reduce its need for water to replace use of mains water in of energy from the Murray Darling Basin. Tarac’s processes. 4. Looking for sustainable growth opportunities By applying a closed loop system, Advice for others in adopting Tarac also recycles and reuses its circular own by-products. Waste water from Element/s of the food hierarchy Tarac’s own processes is recovered, model addressed: 1. Be prepared to make a long term treated at the same plant and re-used commitment to achieve results. for Tarac’s own processes. Solid M Source Reduction 2. Attitude and commitment o s t & Reuse are key. residuals from Tarac’s processes Pref Feed Hungry are turned into stock feed, mulch, er r People soil conditioners and other products ed for the agricultural and horticultural Feed Animals industries. Industrial uses

In addition to the wine industry, Tarac Le Composting a s t supplies products to other industries P r e f Landfill/ e including craft distilleries and other r re Incineration alcoholic beverage producers, food, d homeopathy & naturopathy.

Business results With almost 90 years experience, Tarac is the leading manager of winemaking residuals in Australia.

Tarac has been recognised for its contribution to the wine industry and sustainability through a number of awards including Banksia Sustainability Awards and Australian Business Awards.

Case study

Mackay Sugar

Sugar by-products to bioenergy

Date Established Description of business Approach to fighting food Mackay Sugar, a Member of waste through circular 1988 Nordzucker Group, is Australia’s The two main by-products of second largest sugar milling sugar production are biomasses company, producing 690,000 tonnes - bagasse, the fibre left over from of raw sugar a year. They also have a crushing the sugarcane, and Location 25 per cent interest in sugar refining molasses. Bagasse is used for Mackay, Queensland within Australia and New Zealand in biofuel and molasses is used a joint venture with Wilmar. as supplementary stock feed.

Sugar milling produces valuable Business type Business results by-products which Mackay Sugar Sugar, molasses and is processing for its ‘green projects’ Through using bagasse, Mackay electricity producer focused on bioenergy. Sugar is largely energy self- sufficient with excess energy produced being redirected to Driver for establishing circular economy model the national electricity grid. Company size Their 38 megawatt Racecourse AUD$400m+ Mackay Sugar is committed to Cogeneration Plant (situated at ensuring their operations are done their Racecourse Mill) produces in an environmentally responsible enough renewable electricity Number of employees manner. They have a ‘nothing to power about 30 per cent of is wasted’ business approach – Mackay year-round. The plant reusing and recycling their by- is also reducing Queensland’s 600 products to create ‘green’ products greenhouse gas emissions with a carbon positive footprint, by 150,000 tonnes equivalent that also enables Mackay Sugar carbon dioxide (CO2e) each year, to grow its business and products. and unlike solar and wind, is not View ‘Nothing is Wasted Cycle’ Factsheet Recognising the growing market intermittent. opportunity and interest in View Cogeneration renewable energy, Mackay Sugar diagram worked to create value from sugar milling by-products molasses and bagasse.

Case study

Where to next Element/s of the food hierarchy Mackay Sugar is undertaking a five Key benefits of Circular model addressed: year refurbishment of their three Economy activity M Source Reduction Mackay sugar mills and will be o 1. Largely energy self-sufficient, s t & Reuse improving energy and processing including production of refined Pref er Feed Hungry r efficiency to maximise output from sugar, using renewable fuel. ed People the Racecourse Cogeneration Plant. 2. Reduced carbon emissions. Feed Animals There is considerable scope to 3. Return mill waste products increase surplus bagasse quantities Industrial uses (ash and mud) to cane-land through improved energy efficiency Le Composting as soil nutrients. a s and increase renewable electricity t P r e 4. Molasses used as animal feed f Landfill/ production. e r re Incineration and as a feedstock for renewable d Mackay Sugar will continue to ethanol production (by Wilmar). monitor opportunities for using their molasses for liquid biofuel production, however the advent of electric Advice for others in vehicles may impact this market. adopting circular Molasses is an excellent renewable 1. If process waste can be recycled carbohydrate feedstock for chemicals to aid production of the input currently derived from fossil fuels – crop (eg sugarcane), yields can developments in this market will also be improved and fertiliser costs be monitored. reduced. Improved water management is 2. Avoid waste disposal costs. another focus for Mackay Sugar, 3. Reduce environmental impact with longer term plans to operate as much as possible (inputs and their mills using a larger percentage outputs). of the water that comes to site 4. Consider biomass-to-energy within the cane. This will reduce the opportunities (thermal or need for supplementary river water, electrical) to increase revenue and reduce outflow to their water or reduce energy input costs. treatment ponds.

Case study

Peats Soil

Organic waste to carbon-rich compost, mulch and bioenergy

Description of business Business model Date Established Peats Soil is a second-generation, Peats Soil receives and South Australian based company processes green organics from 1974 focused on receiving, processing Adelaide council kerbsides and marketing recyclable organic and from businesses with resources in bulk and bag forms. the BiobiN including hotels, supermarkets, schools, office Peats Soils also created the BiobiN, Location buildings, food processors and South Australia a mobile, on-site capture and manufacturers. Peats processes containment bin that starts the the green organics to create composting process for organic soil improvement products for waste (fruit, vegetable and meat) agribusinesses, households and manages the odour. They have and businesses. Company size also developed processes for AUD$18m+ creating biogas and biodiesel. Peats manages and processes 100,000 - 150,000 tonnes of Driver for establishing organic waste annually. circular economy model Number of employees The patented BiobiN® aeration Peter Wadewitz, Managing Director system starts the composting of both Peats Soils & BiobiN® 95 process of organic material, Technologies, started making reducing bacteria and other potting mix for his father when he pathogens. The composting Waste use was in his early teens. This grew process maximises the amount Food and Garden into a nursery and the move to of organic material that can be Organics organics was driven by the State collected by the BiobiN®. Government decision to focus on recycling organics. Once the waste is collected by Peats, the processed or partially Products Close to 15 years ago, Peter processed organic material can • Compost ® developed the BiobiN that enables be added to products such as soil • Mulch the composting of organic waste conditioners, compost and biofuels • BIogas to start before being collected by – providing a valuable supply of • Biodiesel Peats. In 2005, Peter demonstrated nutrients, carbon and organic matter • BiobiN ® the BiobiN on the show ‘New to agricultural soils, landscape Inventors’. supplies and alternative fuels.

Case study

This compost goes back to gardens, The Whyalla renewable energy plant farms and vineyards as organic is planned to be fully operational by Key benefits of Circular and carbon-rich material to improve 30th June 2020. The site will process Economy activity soil health. green, organic and food waste, digest 1. High quality compost restores the waste using Anaerobic Digestion, nutrients in the soil. Peats also capture the methane gas to produce both biogas for sale into produced by rotting organic material the grid and a compost product that 2. Reduced food waste in landfill to create biogas for renewable can be sold to surrounding agricultural 3. Alternate energy sources energy production, and dirty fat from markets for soil improvement and through biogas and biodiesel food service and supermarkets carbon enhancement. Compost 4. Reduced the requirement for to create biodiesel. product can be palletised for using water use of up to 60% on key Peats works to continually improve in an air seeder on farm. agriculture crops their processes and products applying Peats is working to have its 25 insights from their customers in the strong truck fleet run on the biodiesel farming community and also working produced through the onsite biodiesel Advice for others in with company scientists and industry plant and the whole operation adopting circular professionals to ensure products are powered by biogas from an anaerobic 1. The opportunities are huge and certified and tested to meet Australian digestion process. now is the time to take action. standards. 2. Requires a coordinated approach Element/s of the food hierarchy across all levels of government Business results model addressed: and industry Peats has built over 500 BiobiNs 3. Need to build additional M Source Reduction with most in use around Australia. o s composting capacity in t & Reuse There are also BiobiNs in China, Pref regional areas er Feed Hungry r USA and UAE, markets that present ed People big opportunities for organic waste Feed Animals capture and conversion. Industrial uses In May 2019, Peats opened its fourth Le Composting composting and renewable energy a s t P r manufacturing at Whyalla, South e f Landfill/ e r Australia. re Incineration d

Where to next The company’s vision is to be a world leader in sustainable and innovative organics recycling to produce valuable landscaping, garden and horticulture products.

If you are interested in fighting food A list of existing Fight Food Waste waste and benefiting from the circular CRC participants can be found at economy, the Fight Food Waste CRC fightfoodwastecrc.com.au/about- is here to help. You can either: us/participants/. 1. Contact the Fight Food Waste CRC (08 8313 3564 or enquiries@ Should you prefer to discuss fightfoodwastecrc.com.au) or go to your options in person contact our website fightfoodwastecrc.com.au Dr Steven Lapidge, CEO of the to obtain simple advice. Fight Food Waste CRC at [email protected]. 2. Present your opportunity to the SME Solutions Centre (fightfoodwastecrc.com.au/project/ sme/) when funding rounds are open and apply for up to $50,000 (matching funding required) to develop new products or processes within your business to eliminate waste.

3. Become a participant in the Fight Food Waste CRC to undertake larger research, development or extension projects, as well as benefit from networking with like-minded organisations and receiving regular information on what is happening globally in the fight against food waste.

Shifting from a KPMG ’s circular economy services include: linear to a circular • Research and trends analysis • Providing education and training model presents to give insights on market activity, to help build circular capabilities. regulatory opportunities and risks opportunities and and stakeholder expectations. • Facilitating external collaborations to accelerate the benefits for businesses, • Identifying and assessing transition to circular through open circular risks and opportunities innovation challenges for problem communities and the through material flow analysis to solving, or targeted connections to environment. identify opportunities for circular, researchers, commercial partners, solutions to enable circular and and others. model the financial benefits KPMG specialists bring together skills and costs. • Implementing strategy including in supply chain advisory, sustainability, change management support, strategy, innovation, customer and • Developing strategy and and measurement and reporting marketing, business modelling and determining what is needed of circular impacts. finance to help your organisation along to implement these solutions, the circular economy journey, no matter including skills and competencies. • Assessing circular and what stage you are at. sustainability reports prepared • Developing metrics to measure by organisations to communicate As well as supporting individual business circular performance set goals, progress against metrics. from a variety of sectors, KPMG brings targets and performance experience working with organisations monitoring metrics. such as:

• World Business Council for Sustainable Development – developed a circular metrics Linear risks are real framework that helps companies Co-authored by Circle Economy, PGGM, KPMG, WBCSD, measure and benchmark their circular and EBRD, the report aims to raise awareness and create performance a constructive dialogue with the financial and business • European Commission – provided community to better understand and model ‘Linear Risks’ training to advise government on – the exposure to the effects of linear business practices strategies to stimulate circular which will negatively impact an organisation’s ability to economy and delivered training to continue as a going concern. It also aims to increase small and medium enterprises to help awareness on how circular economy can provide a solution them go circular to mitigate these ‘Linear Risks’. • Rabobank NL – partnered to deliver the Rabobank Circular Economy Challenge aimed at supporting Dutch businesses on their circular economy journey.

Thank you to the following people for their contribution to this report:

• Dr Steven Lapidge, Fight Food Waste CRC • Ben van Delden, KPMG • Adrian King, KPMG • Amanda Goddard, KPMG • Scott Valentine, KPMG • Marie-Claire Renault, KPMG • Lucy Gubbins, KPMG • Adrian Cullen, Woolworths • Alex Holt, Woolworths • Krista Watkins, Natural Evolution Foods • Roslyn Aikman, YUME • Julie Rawlings, Tarac Technologies • Jeremy Blanks, Tarac Technologies • Peter Gill, Mackay Sugar Looking for more inspiration?

• Fight Food Waste CRC, fightfoodwastecrc.com.au • KPMG – Let’s help SMEs to go circular, ec.europa.eu/environment/sme/pdf/Training%20materials_English.pdf • KPMG – Circular Economy Services, home.kpmg/xx/en/home/insights/2019/04/circular-economy-services • Ellen MacArthur Foundation – Food Initiative, ellenMacArthurfoundation.org/our-work/activities/food • Food Drink Europe Ingredients for a circular economy, circulareconomy.fooddrinkeurope.eu • Circular CoLab, circularcolab.org/us-circular-economy-report • Too good to go, toogoodtogo.com/en • Danish Food Cluster, danishfoodcluster.dk/members • Winnow, cutting food waste with artificial intelligence, circularitycapital.com/winnow-portfolio • UK Food waste supermarket, circulatenews.org/2016/10/food-waste-ripe-innovation-two-uk-examples • Phenix, wearephenix.com • The Plant (USA), plantchicago.org • The state of circular economy in America, circularchange.com/s/USCEStudy_FullReport.pdf • Holland Circular Hotspot, hollandcircularhotspot.nl/en • Planet Ark, planetark.org

International enabling ecosystems

Around the world, Governments are Sixty three legally binding targets circular solutions. To date, 28 SME driving activity to enable and promote and 68 non-binding objectives were support organisations (for example a shift toward circular. The following set across nine environmental policy chambers of commerce and sector provides examples of some of these areas that the EU member states associations) have received training activities from around the world. have to meet37 to establish or expand their support • EU Strategy for Plastics in a programmes on the subject of 40 EU Circular Economy – EU-wide policy circular economy. framework adopting a material- • EU Circularity Agenda 2024 – Netherlands In 2015, the EU Action Plan for the specific lifecycle approach to • Goal for The Netherlands to be Circular Economy was adopted and integrate circular design, use, reuse a completely circular economy outlined plans to move towards and recycling activities into plastics 38 by 2050. “A Circular Economy circular economy, to improve value chains in the Netherlands by 2050”, a competitiveness, create jobs, • The EU has established resource- government-wide programme for and enable sustainable growth.33 related policy goals extending as far circular economy was released in ahead as 2050 as part of its Europe • Product Environmental Footprint – September 2016. The document 2020 strategy. In many cases, these a methodology for measuring the marks the start of a coordinated goals are accompanied by relevant environmental impact of products, and focused effort towards circular targets and indicators to track as well as a includes a set of with a shared vision and agreed implementation39. principles for communicating the pathway. Five economic sectors and • In September 2018 ‘Let’s help SMEs environmental performance of value chains have been identified 34 to go circular’ project was released. products. as priorities for the transition to This was a project of the European • EU Monitoring Framework for the circular, including biomass and food, Commission DG environment in Circular Economy (2018) – 10 key and transition pathways have been conjunction with KPMG provided indicators covering each phase of developed.41 training support and materials the lifecycle of products as well as • Once a year the Ministry 35 to small-medium enterprises. It competitiveness aspects of Infrastructure and Water was noted that Small-medium • Environmental Indicator Report Management will hold the National enterprises (represent 99% of of 2012 – first analysis of Europe’s Circular Economy Conference all EU businesses) were having progress in achieving a more (in Dutch), and the Netherlands difficulty in transitioning to circular sustainable, regenerative economy, Environmental Assessment Agency due to more limited organisational, using six key indicators to assess (PBL) will publish a progress report technological and financial capacity resource efficiency and a further six every two years. and access to (pre-) financing for addressing ecosystem resilience36.

33. https://ec.europa.eu/environment/circular-economy/index_en.htm 34. https://europen-packaging.eu/policy/4-eu-product-environmental-footprint.html 35. https://ec.europa.eu/eurostat/web/circular-economy 36. http://reports.weforum.org/toward-the-circular-economy-accelerating-the-scale-up-across-global-supply-chains/favourable-alignment-of-enablers/?doing_wp_cron= 1572381733.9413309097290039062500#hide/fn-49 37. http://reports.weforum.org/toward-the-circular-economy-accelerating-the-scale-up-across-global-supply-chains/favourable-alignment-of-enablers/?doing_wp_cron= 1572381733.9413309097290039062500#hide/fn-49 38. https://ec.europa.eu/environment/circular-economy/pdf/report_implementation_circular_economy_action_plan.pdf 39. http://reports.weforum.org/toward-the-circular-economy-accelerating-the-scale-up-across-global-supply-chains/favourable-alignment-of-enablers/?doing_wp_cron= 1572381733.9413309097290039062500#hide/fn-49 40. https://ec.europa.eu/environment/sme/circular_economy_boost_en.htm 41. https://www.government.nl/documents/leaflets/2016/09/22/a-circular-economy-in-the-netherlands-by-2050

• The Dutch Government is actively presented by a circular approach to France seeking policy and incentives food production, waste and value • In France, major legislation passed 43 for businesses to go circular and from by-products. in 2015 on energy transition was a working to remove legislative • The Ministry for Infrastructure first significant step in raising public 42 roadblocks with a focus on: has open lines of communication awareness about the issue of waste – Fostering legislation and so people can identify and raise and moving toward a more circular regulations – this involves challenges to achieving a circular economy.47 reviewing legislation to identify economy. • “National Pact to Combat Food any laws that cause roadblocks • Food Smart Facility – The Waste” in 2016, France made a for the transition to a circular Netherlands, Rabobank, the World commitment to reduce food waste economy. These roadblocks will, Bank, IFAD, FAO and the Rockefeller by half by 2025.48 wherever possible, be transformed Foundation are working together to • The first national law against food into incentives. develop a global framework to tackle waste, known as the “Loi Garot”, – Intelligent market incentives – food loss. This includes ‘country establishes a set of measures to for example financial benefits for heat maps’, which show losses reduce and manage this problem, companies that use resources within the main food production particularly at the food retail level49 as sustainably and efficiently as chains in each country and which possible, and higher prices for allows it to identify scope for action Finland products manufactured in a way and investment. that is harmful to the environment • In 2016, Finland released its Circular Economy roadmap – Financing UK aimed at outlining the plan to be a – Knowledge and innovation • UK Govt Food Waste Measurement carbon-neutral circular economy – International cooperation Roadmap - to halve food waste by 2025. The roadmap was by 203044 – Investments being made in developed with input from various businesses working toward • The Courtauld Commitment is sectors, companies, government a circular economy a voluntary agreement aimed at departments and researchers and improving resource efficiency • The Government’s aim is that by pilot projects were identified in the and reducing waste within the UK 2030, 50% of materials to be reused Circular Economy Roadmap grocery sector. The agreement is as far as is possible, and for waste • An updated roadmap was released in funded by Westminster, Scottish, to be converted into usable raw March 2019 to recognise the need for Welsh and Northern Ireland materials where possible. revised goals and actions. Examples governments and delivered by • The Government has committed €8 of actions identified in the Roadmap the Waste and Resources Action million in 2020 for programmes to include impact investing and financing Programme (WRAP). It supports advance the transition to a circular for internationally competitive circular the UK governments’ policy goal economy in a variety of sectors. solutions, and tools for industry to of a ‘zero waste economy’ and To incentivise circular projects transition to circular. climate change objectives to reduce that reduce carbon emissions, • In an effort to position Finland leader greenhouse gas emissions45 the Government plans to make a in circular economy, initiatives are • The UK Plastics Pact46 is a one-off sum of €80 million available focused on building capabilities in trailblazing, collaborative initiative in 2020 for circular projects from sustainable food systems, bio-based that will create a circular economy groundworks, roadbuilding and economies and digitisation (data and for plastics. It brings together hydraulic engineering. new technologies) businesses from across the • In April 2017, PBL Netherlands • Business Finland and the Ministry entire plastics value chain with UK Environmental Assessment Agency for Foreign Affairs have make the governments and NGOs to tackle released a policy brief Food for the circular economy part of Finland’s the scourge of plastic waste. Circular Economy that focused country image.50 on policy needs and opportunities

42 https://www.government.nl/topics/circular-economy/encouraging-a-circular-economy 43. https://www.pbl.nl/sites/default/files/downloads/PBL-2017-Food-for-the-circular-economy-2878.pdf 44. https://www.igd.com/articles/article-viewer/t/food-waste-in-2019-whats-new-whats-happening/i/21526 45. http://www.wrap.org.uk/content/what-is-courtauld 46. http://www.wrap.org.uk/content/the-uk-plastics-pact 47. https://theconversation.com/the-rise-of-the-phenix-giving-a-second-life-to-food-waste-97407 48. https://media.sitra.fi/2017/02/28142644/Selvityksia121.pdf 49. https://theconversation.com/the-rise-of-the-phenix-giving-a-second-life-to-food-waste-97407 50. https://media.sitra.fi/2019/03/20110330/kiertotalouden-tiekartta-tiivistelma-en2.pdf

Scotland USA • The Government has a target to • In May 2019, the Government • In 2013, US Department of Agriculture reduce foodwaste by 1/3 by 2025.51 introduced the Food Loss Reduction and the Environmental Protection • ZeroWaste Scotland was established Promotion Bill which will come into Agency launched the U.S. Food Waste in 2014 to provide leadership, practical effect by the end of 2019. The Bill Challenge for stakeholders in the food support and inform policy and includes the establishment of a food value chain to share best practices on investment for a circular economy in loss reduction body in the Cabinet ways to reduce, recover, and recycle Scotland. The not for profit is funded Office that will be responsible for food loss and waste. The goal was to by the Scottish Government and the policy development on the issue. The have 1,000 participants by 2020. By European Regional Development Fund Bill establishes October as the annual the end of 2014, the U.S. Food Waste Food Loss Reduction month and Challenge had over 4,000 active • In 2016, the government committed requires Government to investigate participants £70 million for a Circular Economy food loss and enable initiatives that Investment Fund and Service to • In 2015, aligned with the UN support entities such as Food Bank.55 support small and medium-sized Sustainable Development Goals, the enterprises (SMEs) to develop • The Japanese concept of “mottainai” United States government has set a technologies, business models and refers to regret at allowing a resource national target to reduce food waste infrastructure for circular and help to go to waste without using its by 50% by 2030. 56 existing businesses redesign their full value. • R ecognising that a shift to reducing process in order to move towards a • The Japanese food industry recycles food waste needs active participation circular economy.52 about 85 per cent of its food waste, from the whole value chain, the US • In 2016, the circular economy which are turned into animal feed, Department of Agriculture has named 57 strategy “Making Things Last” was fertilizer or methane. 25 major food manufacturers, retailers published with a focus on waste and food service and hospitality China prevention and four key areas: 1. organisations as Food Loss and Waste Food and drink and the bio-economy, • China’s circular economy effort 2030 Champions. Each champion has 2. Remanufacture, 3. Construction commenced 20 years ago as a way committed to a reduction in food loss and the build environment, and 4. to improve the economy, protect the and waste within their own operations Energy infrastructure.53 environment and reduce the demand and is required to report on progress on natural resources.58 through their company websites.61 • In September 2019, the Government proposed a Circular Economy Bill • A number of policies have been • In October 2018, a joint agency with a plan to drive towards net zero introduced to encourage the agreement titled Winning on Reducing carbon emission by 2045. The Bill is development of circular economy Food Waste Initiative was signed by open for consultation and includes systems. For example, In 2008 the the U.S. Department of Agriculture plans for a “Green New Deal” to Standing Committee of the 11th (USDA), the U.S. Environmental drive investment into projects that National People’s Congress (NPC) Protection Agency (EPA), and the U.S. will support the net zero carbon formalised aspects of the Circular Food and Drug Administration (FDA). emission goal.54 Economy concept in a Circular This is a formal commitment to a Economy Promotion Law59 shared vision of reducing food loss and Japan • In 2018, China and the EU signed a waste and an agreement to coordinate • The Japanese Government enacted Memorandum of Understanding on actions (for example research, policy the law entitled “Basic Act on Circular Economy Cooperation to discussion, public-private partnerships, Establishing a Circular Society” set a platform for greater sharing of and methodologies for measuring in 2000. best practice and continued focus, food waste) and leverage government investment and improvement related resources.62 to circular economies.60

51. https://www.zerowastescotland.org.uk/reduce-food-waste 52. https://resource.co/article/scotland-invests-%C2%A370-million-develop-circular-economy-10877 53. https://www.gov.scot/publications/making-things-last-circular-economy-strategy-scotland/pages/2/ 54. https://resource.co/article/scottish-government-table-circular-economy-bill 55. https://zenbird.media/new-japan-law-to-aid-food-banks-and-spread-food-loss-awareness/ 56. https://www.abc.net.au/radionational/programs/philosopherszone/avoiding-waste-with-the-japanese-concept-of-mottainai/6722720 57. https://www.sitra.fi/en/articles/japan-finland-show-off-circular-economy-wcef2018/ 58. https://www.youtube.com/watch?v=r-36deRWjx0&list=PLXT_ozykGVanA0x8nK7BP7AHNP9Ln2B4P&index=10 59. http://www.indigodev.com/Circular1.html 60. https://www.ellenMacArthurfoundation.org/news/china-eu-agreement-paves-way-for-global-adoption-of-circular-economy 61. https://www.usda.gov/foodlossandwaste/champions 62. https://www.usda.gov/foodlossandwaste/winning

Ben van Delden Partner, AgriFood Tech and Circular Economy Lead T: +61 3 9288 5894 E: [email protected]

Adrian King Partner in Charge, Climate Change & Sustainability T: +61 3 9288 5738 E: [email protected]

Amanda Goddard Associate Director, AgriFood Tech and Circular Economy T: +61 7 3233 9749 E: [email protected]

Scott Valentine Senior Circular Economy Specialist T: +61 3 9288 6135 E: [email protected]

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