What is Material Flow Analysis?

What is Material Flow Analysis?

Material flow analysis (MFA) is a systematic assessment methodology that quantifies the flows and stocks of materials within a defined system—whether a single facility, a supply chain, an industrial sector, or an entire economy. Rooted in the principle of mass conservation (what goes in must come out or accumulate), MFA traces materials from extraction through processing, manufacturing, use, and end-of-life to identify where resources are consumed, lost, or wasted. The methodology is standardized under ÖNORM S 2096 and widely applied in industrial ecology, waste management planning, and circular economy strategy.

Why It Matters

You cannot manage what you cannot measure, and most organizations have remarkably poor visibility into their material flows. A 2023 survey by the World Business Council for Sustainable Development found that fewer than 30% of manufacturers could quantify material losses across their full value chain. This blind spot translates directly into financial waste—the EU estimates that European businesses could save €600 billion annually through improved material efficiency, representing 8% of annual turnover.

MFA provides the empirical foundation for circular economy strategies. Without quantified material flow data, decisions about recycling infrastructure, waste reduction targets, industrial symbiosis partnerships, and product redesign are based on assumptions rather than evidence. The cities, regions, and companies that have achieved the most significant circular economy progress—Amsterdam, the Kalundborg industrial cluster, Interface Inc.—all began with rigorous MFA.

Regulatory drivers are increasing demand for MFA capability. The EU Circular Economy Monitoring Framework tracks material flows at the member state level, and the Corporate Sustainability Reporting Directive (CSRD) requires companies to disclose resource use and circular economy metrics under the ESRS E5 standard. Extended producer responsibility schemes, landfill taxes, and waste reduction mandates all depend on material flow data for design, implementation, and enforcement.

Climate strategy also depends on MFA. Material production—steel, cement, aluminum, plastics, chemicals—accounts for roughly 23% of global CO₂ emissions. Identifying where materials are lost, downgraded, or prematurely discarded reveals decarbonization opportunities that energy-focused climate strategies miss entirely. A company that reduces material throughput by 20% through MFA-informed redesign achieves emissions reductions that no amount of renewable energy procurement can replicate.

How It Works / Key Components

MFA follows a structured methodology. First, the system boundary is defined—geographic scope, temporal period, and the specific materials or substances to be tracked. Boundaries may encompass a single production line, an entire facility, a product lifecycle, a regional economy, or a national economy. The choice of boundary determines data requirements, analytical complexity, and the types of insights the analysis will produce.

Second, material flows are quantified. Inputs (raw materials, components, water, energy carriers), outputs (products, co-products, emissions, waste streams), and stocks (materials accumulated within the system, such as inventory, infrastructure, or products in use) are measured or estimated for each process within the system boundary. Data sources include production records, procurement data, waste manifests, emissions inventories, trade statistics, and engineering estimates.

Third, a material balance is constructed. Because mass is conserved, total inputs must equal total outputs plus changes in stock. Discrepancies in the balance indicate measurement errors, unaccounted flows, or hidden losses—each of which is analytically valuable. Sankey diagrams are the standard visualization tool, depicting flows as proportionally scaled arrows between processes.

Fourth, the results are interpreted to identify intervention opportunities. Common findings include: disproportionate material losses at specific process steps, high-value materials being sent to low-value recovery pathways, recyclable materials contaminated by mixing with non-recyclable streams, and accumulation of materials in stocks that could be mobilized through urban mining or remanufacturing. These insights drive targeted improvement programs with quantified business cases.

Council Fire's Approach

Council Fire uses material flow analysis as a foundational tool in supply chain sustainability and climate resilience engagements, helping organizations map resource dependencies, quantify waste and emissions hotspots, and identify circular economy opportunities. Our MFA work integrates with Scope 3 emissions accounting and natural capital assessment, providing clients with a comprehensive understanding of how materials move through their value chains and where interventions deliver the greatest environmental and economic returns.

Frequently Asked Questions

What data is needed for a material flow analysis?

At minimum, MFA requires input quantities (raw materials purchased, components received), output quantities (products shipped, waste disposed, emissions released), and inventory data. Sources include ERP systems, procurement records, waste hauling invoices, emissions reports, and production logs. For economy-wide MFA, national statistical agencies provide trade, production, and waste data. Data gaps are common and are addressed through estimation methods, with uncertainty analysis indicating confidence levels for each flow.

How long does a material flow analysis take?

A facility-level MFA focused on key material streams can be completed in 4–8 weeks with adequate data access. A comprehensive product lifecycle MFA spanning multiple supply chain tiers typically requires 3–6 months. Economy-wide MFA conducted by national agencies operates on annual reporting cycles. The primary time driver is data collection—organizations with mature ERP and environmental management systems complete MFA significantly faster than those assembling data from disparate sources.

How does MFA relate to life cycle assessment (LCA)?

MFA and LCA are complementary. MFA quantifies material flows and stocks within a defined system, answering "where do materials go and how much?" LCA assesses the environmental impacts associated with a product or service across its full lifecycle, answering "what are the environmental consequences?" MFA data frequently serves as input for LCA models. Together, they provide both the physical accounting and the impact assessment needed for informed decision-making on material use, product design, and supply chain optimization.