(441a) Exploring the Material Interlinks and Footprint of Chemical Industry Based on Input-Output Analysis | AIChE

(441a) Exploring the Material Interlinks and Footprint of Chemical Industry Based on Input-Output Analysis


Jiang, M. - Presenter, Tsinghua University
Zhu, B., Tsinghua University
Ren, Y., Tsinghua University
Chen, X., Tsinghua University
Ren, Z., Tsinghua University
Our human society is built upon materials and our economy is fueled by materials – fossil fuels, biomass, metals and non-metallic minerals. Scholars adopt the key concept –mass balance – from chemical engineering to investigate how the materials are metabolized (entering and leaving a system) in the global economy (International Resource Panel 2016). Two approaches are widely used to evaluate the mass balance in the macro-scale (i.e., for an economy or an industry): the direct material flows based on economic-wide material flow accounting (EW-MFA) and the material footprint (MF) accounting based on the input-output analysis.

The core concept of the traditional approach, EW-MFA, is the measures of direct use (i.e., apparent consumption) by adding up the raw materials extracted from the domestic territory and all physical imports but deducting all physical exports. It is wildly used by the government and authorities to support decision making. However, it does not consider the upstream raw material embodied in imports and exports. Scholars further have indicated that this truncation could be misleading as the production and consumption activities are increasingly separated as the globalization developed (Wiedmann, Schandl et al. 2015, Malik, McBain et al. 2019). Hence a new indicator - material footprint (MF) - is proposed to measure the total resources required by an economy with a life-cycle perspective. MF does not record the physical movement of materials within and among countries but describes the link between the beginning of a production chain (where raw materials are extracted from the environment) and its end (where a product or service is consumed) (Wiedmann, Schandl et al. 2015, Stadler, Wood et al. 2018, Wiedmann and Lenzen 2018, Jiang, Behrens et al. 2019). It promises the possibility to trace material flows embodied in trade in the global economic network.

Current studies paid more attention to the comparison across countries in terms of resource extraction and consumption (Bruckner, Giljum et al. 2012, Schaffartzik, Mayer et al. 2014, Wiedmann, Schandl et al. 2015, Schandl, Fischer‐Kowalski et al. 2018). However, investigations on the role of a specific industry in the global material economy are not sufficient, such as the chemical (engineering) industry. Chemical industry has its pivot position and strong ripple effects in the global supply chain. Every single dollar created directly by the chemical industry could contribute another 4.2 USD values created elsewhere in the global economic network (Oxford Economics 2019). To best our knowledge, no studies have conducted such analysis based on the physical unit. As the chemical industry is closely related to almost all economic sectors such as energy, water, food, materials, medical, transportation and environment (Das and Cabezas 2018), it is hence important to understand, from the material metabolism perspective, its role in the global material economy and further, the potential contribution towards the sustainable development.

Against this background, we modeled the global material footprint network and attempted to identify the role of the chemical industry in the material supply chain across countries. We adopted a novel global accounting framework, global multi-regional input-output models (GMRIO, EXIOBASE) with the detailed material database to assess the material footprint of the chemical industry (Stadler, Wood et al. 2018). We further employed the structural path analysis (SPA) in GMRIO. It is an application of Taylor’s expansion in the Leontief inverse matrix under the input-output framework (Skelton, Guan et al. 2011). By expanding the input-output structure, the intermediate production layers are extracted, which provides an exhaustive (tree-structured) map of global supply chain linkages between the materials extraction and consumption (Wood and Lenzen 2009). It enables us to explore the embodied material flows of intermediate products among the complex interlinks among sectors and countries.

Our preliminary results show the global material use of 2010 reaches 71.8 Gt (billion tons) including 19.3 Mt (26.9%) of biomass, 13.3 Mt (18.5%) of fossil fuels, 7.3 Mt (10.2%) of metals and 31.9 Mt (44.4%) of nonmetallic minerals. As a manufacturing sector, the chemical industry cannot be considered as a major material driver but a giant material processor in the world. It demands 9.5% (6.8 Gt) of global total materials. The highest proportion is found in crude oil which reaches 39.9% (1.4 Gt) among 3.6 Gt of the world crude oil extraction. As MF records the consumption-based demand, this part of crude oil is not the one that transformed into products but consumed by the chemical industry (as an end-user). It indicates the crucial role of the chemical industry in climate mitigation.

Besides, the chemical industry, especially in Asia-Pacific, processed a tremendous amount of intermediate materials flows in the global economy. By unfolding the production layers, the SPA model shows the processed amount of fossil fuels by the petroleum industry in Asia and the Pacific exceeds its final demand by 73% (higher). While the processed amounts of all production layers in Europe and North America are all smaller than their final demands. It confirms that Asia-Pacific (and its chemical industry) is indeed the world's factory and has undertaken a large number of production tasks for the rest of the world. Similar phenomena are also found in other material groups. Our further analysis will lay on the material networks to understand the upstream and downstream interlinks of the chemical industry among other industries across countries. With a full picture of the material economy and the unfolded supply chain, it may further strengthen our understanding of how the chemical industry would support the global material economy and the transition towards sustainability based on a life-cycle perspective.