Analyzing material flow and value added associated with non-metallic mineral wastes in Japan

Ryoji, Hasegawa; Nakayama, Hirofumi; Shimoaka, Takayuki Article Analyzing material flow and value added associated with non-metallic mineral wastes in Japan Journal of Economic Structures Provided in Cooperation with: Pan-Pacific Association of Input-Output Studies (PAPAIOS) Suggested Citation: Ryoji, Hasegawa; Nakayama, Hirofumi; Shimoaka, Takayuki (2017) : Analyzing material flow and value added associated with non-metallic mineral wastes in Japan, Journal of Economic Structures, ISSN 2193-2409, Springer, Heidelberg, Vol. 6, Iss. 37, pp. 1-15, https://doi.org/10.1186/s40008-017-0098-3 This Version is available at: https://hdl.handle.net/10419/194904 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. https://creativecommons.org/licenses/by/4.0/ Analyzing material flow and value added associated with non‑metallic mineral wastes in Japan Hasegawa Ryoji1*, Hirofumi Nakayama2 and Takayuki Shimoaka2 1 Background Rubble, slag, and sludge, referred to as non-metallic mineral wastes, are frequently recycled as alternate materials for natural non-metallic mineral resources such as dirt, crushed stone, sand, and clay. Concrete waste and asphalt concrete waste, which are non-metallic mineral wastes, are categorized as industrial wastes in Japan. According to the annual report of Japan’s Ministry of the Environment (2015), the emission of these non-metallic mineral wastes in 2012 was 56.7 million tons in the country, which accounted for 15% of the 379.1 million tons of total industrial waste. There are two emission sources of non-metallic mineral wastes: waste derived from demolishing existing stock, such as structures, and that generated as byproducts of industrial production. Specifically, concrete waste and asphalt generated from demolishing structures and repairing roads, respectively, are non-metallic mineral wastes derived from the demolition of existing stock. On the other hand, iron and steel slag and coal ash, derived from the steel industry and coal-fired power generation, respectively, are non-metallic mineral wastes generated as byproducts of production. Abstract This paper sheds light on the increase in generation of non-metallic mineral wastes and the decrease in demand for construction by investigating the material flow resulting from and the economic influence of changes in the supply and demand for wastes, focusing on the period from the near future to 2030. We predict the amount of final disposal of non-metallic mineral wastes and its influence on industries in the future under the assumption of two scenarios—zero emission and business-as-usual—using linear programming and input–output techniques developed for non-metallic mineral materials. We conclude that zero emission can be achieved at the cost of a 3.76% decrease in the value added of industries related to non-metallic mineral wastes. Otherwise, the final disposal might increase 13 times the size of 2005’s disposal. Considering the empirical results, we discuss an effective policy for non-metallic mineral waste management from the viewpoints of material flow and economic influence. Keywords: Non-metallic mineral waste, Material flow, Balance of supply and demand, Linear programming, Input–output table JEL Classification: Q50, Q53, C61, C67 Open Access © The Author(s) 2017. This article is distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and reproduction in any medium, provided you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license, and indicate if changes were made. RESEARCH Ryoji et al. Economic Structures (2017) 6:37 https://doi.org/10.1186/s40008‑017‑0098‑3 *Correspondence: [email protected] 1 Faculty of Urban Management, Fukuyama City University, 2-19-1, Minatomachi, Fukuyama, Hiroshima 721-0964, Japan Full list of author information is available at the end of the article Page 2 of 15 Ryoji et al. Economic Structures (2017) 6:37 On the supply side, considering the generation of non-metallic mineral wastes in the future in Japan, it is expected that concrete waste will continuously and drastically increase. In Japan, the stock of structures had been rapidly accumulated since the 1950s in accordance with high economic growth. Especially, the stock of non-timber structures, which is the main generation source of concrete waste, continued to increase at a higher ratio than that of timber structures every year, and the increasing trend was sustained until the 1990s (see e.g. Ministry of the Environment 2002). The demolition of structures that have reached the end of their life has already begun to increase and is expected to accelerate in the future. Furthermore, because it is hard to imagine that steel production and coal-fired power generation will suddenly decrease, it is expected that the emission of non-metallic mineral wastes will continue to increase. Hashimoto etal. (2009), for example, estimated the stock of materials accumulated as structures in Japan and noted that 32 billion tons of materials were accumulated as construction commodities in 2000, of which 9 billion tons are likely to be generated as waste in the future. On the other hand, on the demand side, recycled non-metallic mineral wastes are primarily used in civil engineering and construction, such as base course and raw cement materials. The demand has begun to decrease due to the saturation of social infrastructures. This phenomenon leads to the collapse of the balance of supply and demand in nonmetallic mineral wastes, which increases the amount of final disposal. While this phenomenon has already been detected in Japan, there is a high possibility that other Asian countries, which have achieved high economic growth, will also face a similar one in the future. It is crucial to establish appropriate waste management policies, particularly focusing on non-metallic mineral wastes, for sustainable development in the Asia– Pacific region. Therefore, it is significant to select Japan as the case study of non-metallic mineral wastes, because it provides useful implications for future waste policies in Asian countries. Furthermore, it is also significant that this paper, which targets the case study of Japan, is published as the Special Issue on “On the Nexus of Economy and Environment in the Asia–Pacific Region.” Based on the circumstances described above, this paper, considering the case of Japan, investigates the material flow resulting from and the economic influence of the changes in supply and demand for non-metallic mineral wastes, focusing on the period from the near future to 2030. Specifically, we construct an input–output (IO) table to analyze non-metallic mineral wastes to identify monetary and material flows between industries related to supply and demand in non-metallic mineral wastes. Based on the constructed IO table, we predict the material flow and value added brought about by non-metallic mineral wastes in the future by applying a linear programming technique. The reminder of the paper is organized as follows. Section2 explains supply and demand for non-metallic mineral wastes and the related industries covered in this paper. We also compile an IO table for the analysis of non-metallic mineral wastes. Section3 develops a linear programming model to predict material flows and value added in 2030. Section4 investigates the empirical results. Finally, Sect.5 summarizes the discussion and conclusion. Page 3 of 15 Ryoji et al. Economic Structures (2017) 6:37 2 Material flow and industries related to non‑metallic mineral wastes 2.1 Target materials and related industries Figure 1 shows the material flow covered in our analysis. As non-metallic mineral wastes, this paper targets (1) concrete waste, (2) asphalt concrete waste generated from both demolishing structures and repairing roads, (3) iron and steel slag generated as by-products in manufacturing steel, and (4) coal ash generated primarily from the coal power industry. We regard the generation of these four materials as supply and the use of these materials as demand. Application usages are defined as crushed stones for roads, aggregate for concrete, other crushed stones, asphalt mixture, and cement (raw material and admixture ingredient). What is not reused from the non-metallic mineral wastes generated will be disposed of as final disposal wastes. 2.2 Input–output table for analysis of non‑metallic mineral wastes This paper constructs an IO table for the analysis of non-metallic mineral wastes to comprehensively identify the material flow in non-metallic mineral wastes and the related monetary flow among industries. The IO model addressing environmental loads is generally established as the Leontif-Duchin environmental input–output (EIO) model (Leontief 1970; Duchin 1990). While a normal IO table allocates monetary transactions of goods and services among each sector, such as industry, household, and government, Recycled aggregate for concrete Recycled asphalt mixture Other induses Recycled aggregate for concrete Recycled asphalt mixture Natural asphalt mixture Natural aggregate for concrete Cement whose raw maerial is replaced with wastes Cement with various ingredients added Natural cement Crushed stone for recycled base course Other recycled crushed stone Crushed stone for recycled base course Crushed stone for natural base course Construcon industry Other crushed stone Coal ash Iron and steel slag Final disposal Asphalt concrete waste Concrete waste Naturalcement raw materials Naturalcrushed stone Supply Demand Naturalnon-metallic mineral resource Fig. 1 Material flow in supply and demand for non-metallic mineral wastes Page 4 of 15 Ryoji et al. Economic Structures (2017) 6:37 in the form of a matrix, EIO tables are frequently developed by expanding the scope of allocation to include environmental loads such as waste, energy, and air pollutant (see, e.g., Leontief 1970; Bullard and Herendeen 1975; Nakamura and Kondo 2002; Guan and Hubacek 2008). Focusing on application to waste analyses in the IO model, Nakamura and Kondo (2002) establish the waste input–output (WIO) model, which explicitly identifies the interdependence between the flow of goods and waste in the entire economy, and the model has been applied to many case studies (see, e.g., Kagawa 2005; Kagawa etal. 2007; Reynolds etal. 2014; Tsukui etal. 2015). This paper compiles an IO table for non-metallic mineral wastes analysis based on the IO table in 2005 in Japan and other statistics. First, we modify the industrial classifications. Figure2 shows the relationship between the classification in the original table and the compilation of classifications in the IO table for the analysis. The industries involved in the supply of non-metallic mineral materials are crushed stones, paving materials, pig iron, crude steel, electric power for enterprise use, onsite power generation, and waste management services (private). We modify the input sector (column) in these industries according to the materials of non-metallic mineral resources, as shown in Table1, because the production technology in non-metallic mineral resources varies according to the materials. On the other hand, non-metallic mineral materials are demanded mainly for use as crushed stone for roads and concrete aggregate. Accordingly, the output of non-metallic mineral materials, classified by materials in input sectors (column), is integrated to crushed stone for roads, concrete aggregate, and other crushed stone as shown in Fig.2.1 To modify the industrial classifications in the IO table, we first estimate the monetary production value of each non-metallic mineral material by identifying material outputs, prices, mass/volume, and main sale destinations from several statistical sources, such as Ministry of Economy, Trade and Industry (2005) and Nippon Slag Association (2005). In the input sector (column), it is possible to separate recycled crushed stone for roads and recycled concrete aggregate from waste management services (private), and recycled asphalt mixture from paving materials, according to further detailed materials by using several statistics. We further divide these three industries in the output sector (row), as shown in Table1. In Table1, non-metallic mineral wastes generated by these three industries include concrete waste, asphalt concrete waste, iron and steel slag, and coal ash. These wastes are disposed of in different ways. This is why the three aforementioned industries are divided according to the production process. Concretely, we divide the monetary production value in these three industries using the ratio of the volume of input in each non-metallic mineral waste according to the materials shown in Table1. As shown in Table2, conclusively, the classification number is nine in the output sector (row) and 20 in the input sector (column) among industries related to non-metallic mineral wastes, and the other industries consist of 33 sectors. A point to be noted here is that the other industries are not aggregated but divided by 33 sectors in the IO table and the classification completely corresponds to both the input and output sectors. Table3 shows the classification in the 33 other industries. Accordingly, the constructed IO table 1 In the output sector, some other sectors are also integrated to facilitate the linear programming. Page 5 of 15 Ryoji et al. Economic Structures (2017) 6:37 Detailed sector classification in the original table in Japan Input sector (Column) in the constructed IO table Output sector (Row)in the constructed IO table Crushed stonesNatural crushed stones Crushed stones for roads Naturel concrete aggregateConcrete aggregate Other crushed stones Other crushed stones Paving materialsNatural asphalt mixtureAsphalt mixture Recycled asphalt mixture Cement Cement Cement/cement products Ready mixed concrete Ready mixed concrete Cement products Cement products Pig iron Pig iron/crude steelPig iron/crude steel Crude steel (converters) Crude steel (electric furnaces) Repair of constructionRepair of constructionConstruction Public construction of roadsPublic construction of roads Residential construction (wooden) Other civil engineering and construction Residential construction (non-wooden) Non-residential construction (wooden) Non-residential construction (non-wooden) Public construction of rivers, drainages, andothers Agricultural public construction Railway construction Electric power facilities construction Telecommunication facilities construction Other civil engineering and construction Electric power for enterprise use Electric power, gas supply,and steam and hot water supply Electric power, gas supply,and steam and hot water supply On-site power generation Gas supply Steam and hot water supply Waste management services (public) Waste management services (public) Waste management services (public) Waste management services (private) Recycled crushed stones for roads Recycled concrete aggregate Other recycled crushed stones Other waste management services (private) Other waste management services (private) OtherindustriesOther industries Otherindustries Fig. 2 Modification of industrial classifications in the IO table Table 1 Further classification of non‑metallic mineral waste sectors Further classification Raw material Recycled crushed stones for roads 1 Concrete waste, asphalt concrete waste Recycled crushed stones for roads 2 Iron and steel slag Recycled concrete aggregate 1 Concrete waste Recycled concrete aggregate 2 Iron and steel slag Recycled asphalt mixture 1 Concrete waste, asphalt concrete waste Recycled asphalt mixture 2 Iron and steel slag Page 6 of 15 Ryoji et al. Economic Structures (2017) 6:37 for analysis of non-metallic mineral wastes consists of 42 output sectors and 53 input sectors. Regarding industries related to non-metallic mineral wastes, it is impossible to completely identify intermediate transactions from available statistics. Therefore, we estimate those transactions by applying the RAS method to accomplish the construction of the IO table. The RAS method, the most widely-used method to estimate input coefficients, estimates unknown matrices to approximate available input coefficient matrices by using the summations of rows and columns in the IO table as control totals. In applying the RAS method, we use production values as control totals and input coefficients based on the aforementioned statistics as initial values (see, e.g., Miller and Blair 2009) for the outline of the RAS method and the calculation procedure). 3 Prediction of non‑metallic mineral wastes in 2030 via the linear programming method 3.1 Japanese economy and non‑metallic mineral wastes in 2030 As noted in the introduction, the demand for construction is anticipated to decrease in the future, and it has been on a downward trend in recent years. For instance, the Research Institute of Construction and Economy (RICE) in Japan forecasts construction investment in Japan in the present year and next year every 3months, and publishes the Table 2 Industrial classification in the IO table for analysis of non‑metallic mineral wastes Input sector (column) Output sector (row) Industry related to non-metallic mineral wastes 1-1. Natural crushed stones 1. Crushed stones for roads 1-2. Recycled crushed stones for roads 1 1-3. Recycled crushed stones for roads 2 2-1. Natural concrete aggregate 2. Concrete aggregate 2-2. Recycled concrete aggregate 1 2-3. Recycled concrete aggregate 2 3-1. Other crushed stones 3. Other crushed stones 3-2. Other recycled crushed stones 4-1. Natural asphalt mixture 4. Asphalt mixture 4-2. Recycled asphalt mixture 1 4-3. Recycled asphalt mixture 2 5-1. Cement 5. Cement/cement products 5-2. Ready mixed concrete 5-3. Cement products 6. Pig iron/crude steel 6. Pig iron/crude steel 7. Other iron and steel 7. Other iron and steel 8-1. Repair of construction 8. Construction 8-2. Public construction of roads 8-3. Other civil engineering and construction 9. Electric power, gas supply and steam and hot water supply 9. Electric power, gas supply, and steam and hot water supply Other industries (33 sectors) Other industries (33 sectors) Page 7 of 15 Ryoji et al. Economic Structures (2017) 6:37 forecast results several times a year.2 Considering the forecasts, this paper assumes that the final demand in the construction sector declines at an annual rate of 1.1% from 2012 to 2020 based on figures in the IO table in 2011, and will remain constant from 2021 to 2030. Accordingly, the final demand in the construction sector is assumed to decrease to around 38.7 trillion yen, as shown in Table4. RICE conducts middle- and long-range forecast for construction investment, and publishes them in Research Institute of Construction and Economy (2016). The report forecasts construction investment in 2030 to range from 37.5 to 43.4 trillion yen. Therefore, our decile rate has validity to some extent because the estimated value is within the range. The final demand3 for crushed stones for roads, concrete aggregate, other crushed stones, asphalt mixture and cement/cement products is expected to decrease, influenced by construction’s trend. Accordingly, this paper assumes that the final demand in these sectors declines at an annual rate of 1.1% from 2011 to 2020 and remains constant from 2021 to 2030; however, the decline rate of 1.5% is used from 2005 to 2010 for sectors in which the amount of final demand cannot be identified from the IO table in 2011. Regarding the total economy, based on figures in the IO table in 2011, the total GDP of Japan is assumed to grow at a rate of 0.6, 0.9, 0.5, and 0% from 2011 to 2015, 2016 to 2020, 2021 to 2025, and 2026 to 2030, respectively.4 In the prediction of non-metallic mineral wastes, the generation of concrete waste and asphalt concrete waste in the future is independent of production levels at that time, 2 The forecast results are available from the website of the Research Institute of Construction and Economy (RICE), shown in http://www.rice.or.jp/english/index.html. 3 The products in some industries related to non-metallic mineral wastes are entirely demanded as intermediate goods, but the final demand in this paper and in the IO table includes changes in stocks, exports, and imports. 4 To obtain the figures, we referred to the medium-term economic forecast by the Japan Center for Economic Research, as shown in https://www.jcer.or.jp/research/middle/index.html. Table 3 Classification of the 33 other industries The classification numbers follow that of industry related to non‑metallic mineral wastes in Table 2 10 Agriculture, forestry, and fisheries 21 Electrical equipment 32 Real estate 11 Other mining 22 Information and communication equipment 33 Transport 12 Food, beverage, and tobacco 23 Electrical equipment 34 Communication and broadcasting 13 Textiles 24 Transport equipment 35 Public administration 14 Pulp, paper, and wooden products 25 Precision machinery 36 Education and research 15 Chemical products 26 Miscellaneous manufacturing products 37 Medical service, health, social security, and nursing service 16 Petroleum refinery and coal 27 Water supply 38 Other public services 17 Miscellaneous ceramic, stone, and clay products 28 Waste management services (public) 39 Business services 18 Non-ferrous metal 29 Other waste management services (private) 40 Personal services 19 Metal products 30 Trade 41 Office supplies 20 General machinery 31 Finance and insurance 42 Activities not elsewhere classified Page 8 of 15 Ryoji et al. Economic Structures (2017) 6:37 because they are generated from both demolishing structures and repairing roads, in contrast to iron and steel slag and coal ash. For concrete waste and asphalt concrete waste it is assumed that the trend from the actual value in 2005 to the value in 2020 predicted by the Ministry of Land, Infrastructure, Transport and Tourism5 in Japan will continue after 2020. On the other hand, the generation of iron and steel slag and coal ash in 2030 is endogenously determined to be dependent on the production value estimated by linear programming. Table4 summarizes our assumption of the economy and non-metallic mineral wastes in 2030, compared to the actual values in 2005. 3.2 Linear programming model for non‑metallic mineral wastes in 2030 Many studies use the linear programming technique to propose an optimal solution for waste management or recycling policy (see e.g., Gnoni etal. 2008; Zhu and Huang 2011; Song etal. 2016). Especially, linear programming models tend to be constructed based on IO tables when the supply and demand balance in monetary production value or the material flow balance in the entire economy are used as constraint conditions. For instance, Kondo and Nakamura (2005) develop the WIO-LP model, which links an ordinal WIO model to the linear programming model, to propose a systematic method for eco-efficiency analysis. Using the IO table for the analysis of non-metallic mineral wastes, this paper applies a linear programming technique to consider the material flow and value added brought about by non-metallic mineral wastes in 2030. 5 To obtain the figures, we referred to the forecast of construction waste generation of the Ministry of Land, Infrastructure, Transport and Tourism, shown at http://www.mlit.go.jp/sogoseisaku/region/recycle/pdf/fukusanbutsu/genjo/ yosoku.pdf. Table 4 Actual values in 2005 and predicted values in 2030 2005 2030 GDP in the total economy (billion yen) 505,874 511,396 Final demand in industry related to non-metallic mineral wastes (million yen) 1 Crushed stones for roads 19,269 16,323 2 Concrete aggregate 3971 3364 3 Other crushed stones − 6665 − 7854 4 Asphalt mixture 984 788 5 Cement/cement products 11,293 − 4043 6 Pig iron/crude steel − 459,734 − 481,074 7 Other iron and steel 2,283,700 2,389,704 8 Construction 54,117,611 38,691,354 9 Electric power, gas supply, and steam and hot water supply 5,923,813 6,198,781 Generation of non-metallic mineral waste (1000 ton) Concrete waste 32,153 54,780 Asphalt concrete waste 26,060 17,270 Iron and steel slag 40,450 – Coal ash 11,152 – Page 15 of 15 Ryoji et al. Economic Structures (2017) 6:37 Guan D, Hubacek K (2008) A new and integrated hydro-economic accounting and analytical framework for water resources: a case study for North China. 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