Indicators
General information
This indicator of circular economy corresponds to the SDG 8.4.2/12.2.2 Domestic material consumption, domestic material consumption per capita, and domestica material consumption per GDP.
The presented methodology for this indicator is based on UNSD’s Metadata for 8.4.2/12.2.2, UNEP’s The use of natural resources in the economy: A Global Manual on Economy Wide Material Flow Accounting (2021), UNEP’s Economy-Wide Material Flow Accounting Step-by-step guide to the compiler (2024). SDG target 8.4 aims to improve progressively the global resource efficiency in consumption and production and decouple economic growth from environmental degradation and SDG target 12.2 aims to achieve the sustainable management and efficient use of natural resources.
Additional disaggregation
Domestic Material Consumption (DMC) indicator can be disaggregated by main material categories (biomass, fossil fuels, metal ores and non-metallic minerals). More information about the definition of each category is provided in the following section entitled “Definitions”.
Indicator interpretation
Domestic Material Consumption (DMC) has high environmental relevance as an indicator of potential environmental pressure on a domestic territory. DMC covers all materials used on the input side, which actually flow through the domestic economy and which are either emitted back to the environment as waste and emissions or contribute to the increase of the national physical stock with potential flows of waste and emissions in the future (Marra Campanale and Fernia, 2013 An environmentally ineffective way to increase resource productivity: evidence from the Italian case on transferring the burdening abroad). When designing national strategies for resource management, DMC is easy for governments to address compared with indicators which include indirect material flows in other countries along the supply chains of imported products and thus require international policy cooperation.
DMC reports the amounts of materials that are used in a national economy. It is a territorial or geographic bound (production side) indicator. DMC also presents the amount of material that needs to be handled within an economy, which is either added to material stocks of buildings and transport infrastructure or used to fuel the economy as material throughput. It describes the physical dimension of economic processes and interactions. It can also be interpreted as long-term waste equivalent. Per-capita DMC describes the average level of material use in an economy – an environmental pressure indicator – and is also referred to as metabolic profile.
DMC and Material Footprint (MF) need to be looked at in combination, as they cover the two aspects of the economy, production and consumption. The DMC reports the actual amounts of material in an economy while MF the virtual amount required across the whole supply chain to service final demand. A country can, for instance, have a very high DMC because it has a large primary production sector intended for export or a very low DMC because it has outsourced most of the material intensive industrial process to outside of its national territory. The material footprint corrects for both phenomena.
Using DMC, dislocating material-intensive production from the domestic territory away to other geographical regions, while keeping final demand for products and services constant, will result in better apparent performance. In contrast, using raw material consumption (RMC), net-importers cannot improve their performance just by outsourcing. At the same time, RMC figures will be lower compared to DMC figures for net-exporting countries with small domestic final demand.
It is also important to note that MF do not account for unused material extraction, such as overburden from metal or coal mining or harvest residues in agriculture. However, these unused material flows cause various environmental pressures, such as water pollution and landscape changes.
| Indicator | Main Policy Questions |
|---|---|
| DMC |
Which raw materials serve the apparent consumption of a country, i.e. excluding materials and products that are exported abroad? Which are the (policy) hot spots for resource management measures related to the domestic consumption of materials? |
| Material Productivity |
How much economic value is generated by a unit of material consumed by the domestic economy? Has the economy achieved decoupling between economic growth and direct resource use? |
Data availability
The DMC indicator can be mostly calculated based on official national production and trade statistics. DMC data have thus been compiled for a much larger number of countries and from a large variety of statistical and academic institutions.
The data set presented in the SDG database covers data for 193 countries (either globally estimated or country data) from 2000. The International Resource Panel (IRP) publishes estimated data series for 1970-20192.
Limitations in the use of the indicator
The main limitations in the use of the indicator are that DMC do not account for all global material flows related to final consumption in a country, as indirect (or embodied) materials of imported and exported products are not considered. In a globalized economy, supply chains are becoming increasingly international, often involving a large number of countries along a product’s life cycle from the extraction of raw materials, via processing and manufacturing to the delivery of the product to the final consumer. Hence, DMC cannot account for the actual environmental consequences generated by the consumption of certain products, as material flows can be located in other geographical regions.
Countries can therefore apparently reduce their material consumption, as measured with the DMC indicator, by outsourcing material-intensive extraction and processing abroad. This aspect has to be considered when evaluating achievements in decoupling material consumption from economic growth.
Additionally, as mentioned above, DMC do not account for unused material extraction, neither its environmental pressures. Finally, DMC cannot be disaggregated to economic sectors which limits its use and comparation within the System of National Accounts (SNA).
Definitions
“Biomass is material of vegetable origin extracted by humans and their livestock – crops, used crop residues, fodder crops, grazed biomass, wood, capture of wild fish, and the biomass of hunted animals” (UNEP, 2024, Economy-Wide Material Flow. Step-by-step guide to the compiler).
“Domestic Material Consumption (DMC) is a standard material flow accounting (MFA) indicator and reports the apparent consumption of materials in a national economy. DMC measures the total amount of material (biomass, fossil fuels, metal ores and non-metallic minerals) directly used in an economy and based on accounts of direct material flows, i.e., domestic material extraction and physical imports and exports” (United Nations, SDGs metadata).
“Fossil fuels Includes coal and peat, crude oil, natural gas and natural gas liquids, and oil shale and tar sands” (UNEP, 2024, Economy-Wide Material Flow. Step-by-step guide to the compiler).
“Metal ores can best be thought of as those deposits of metal compounds in the Earth’s crust which can be processed to produce desired metals at an economically viable cost. Ore deposits will generally be rock, but in certain important cases can be special soils or sand deposits. Only the portion of the excavated rock which is to be processed in some way to obtain the desired metals is included in the accounts. Data is compiled in three ore categories: iron, aluminum, and other metal ores” (UNEP, 2024, Economy-Wide Material Flow. Step-by-step guide to the compiler).
“Non-metallic minerals are defined by the System of National Accounts 1993 as stone quarries and clay and sand pits; chemical and fertilizer mineral deposits; salt deposits; deposits of quartz, gypsum, natural gem stones, asphalt and bitumen, peat and other non-metallic minerals other than coal and petroleum” (UNEP, 2024, Economy-Wide Material Flow. Step-by-step guide to the compiler).
Calculations
DMC is a standard material flow accounting (MFA) indicator and MFA belongs to environmental-economic accounts and applies the accounting concepts, structures, rules and principles of the System of Environmental-Economic Accounting 2012 - Central Framework. For DMC calculation, the UNEP global EW-MFA guide The use of natural resources in the economy: A Global Manual on Economy Wide Material Flow Accounting (2023) can be used as additional resource.
Domestic material consumption by raw material and total
Domestic Material Consumption (DMC), by type of raw material (tonnes) is calculated as:
𝐷𝑀𝐶=𝐷𝐸 + 𝐼𝑀 − 𝐸𝑋
- Where:
- DMC:
- Domestic material consumption
- DE:
- Domestic extraction of materials
- IM:
- Direct imports
- EX:
- Direct exports
- DMC:
DMC measures the amounts of materials that are used in economic processes. It does not include materials that are mobilized for the process of domestic extraction but do not enter the economic process.
The DMC indicator is disaggregated into four main categories (biomass, fossil fuels, metal ores and non-metallic minerals).
The DMC tab can be used to calculate DMC. This tab compiles information of the four categories and calculates the DMC for each category and the national DMC.
A. Domestic Material Consumption per capita
Domestic material consumption per capita, by type of raw material (tonnes), is calculated as:
Users will insert the annual average population in the DMC per capita tab, and DMC per capita will be automatically calculated for each raw material (when data on raw material has been previously inserted) and the total DMC per capita.M/p>
Note: when data is inserted, some cells might turn red. When cells turn red, it is because some inserted data is not correct.
B. DMC per GDP or Material Intensity
Once the users fill the DMC per capita tab, entering data on GDP in constant 2015 United States Dollars, DMC per GDP or Material Intensity will be automatically calculated for each raw material (when data on raw material has been previously inserted) as well as the total.
C. Material Productivity
Material intensity illustrates the material consumption required to produce one unit of GDP. It is the reciprocal indicator of Material Productivity.
Domestic material consumption per unit of GDP, by type of raw material (kilograms per constant 2015 United States dollars) or Material Intensity, is calculated as:
Material productivity by raw material and total will be automatically calculated in Material Productivity tab, based on data already entered by users.
