Economic Aspects of the Circular Food Economy: The Case of Olive Oil †
Department of Agriculture, Program of Agricultural Economics & Entrepreneurship, International Hellenic University, 57400 Thessaloniki, Greece
*
Author to whom correspondence should be addressed.
†
Presented at the 18th International Conference of the Hellenic Association of Agricultural Economists, Florina, Greece, 10–11 October 2025.
Proceedings 2026, 134(1), 49; https://doi.org/10.3390/proceedings2026134049
Published: 16 January 2026
(This article belongs to the Proceedings of The 18th International Conference of the Hellenic Association of Agricultural Economists)
Abstract
The agri-food sector is among the most environmentally impactful industries globally, making its shift toward sustainability a pressing priority. In response, governments—including the EU—are promoting circular economy (CE) principles across all sectors, with CE implementation serving as a key measure of policy effectiveness. The olive oil sector, while economically and culturally vital, poses significant environmental risks due to intensive resource use and problematic waste disposal. Considering resource scarcity and climate change, CE adoption—grounded in industrial ecology—is increasingly relevant. This study investigates the implementation of CE practices in Greek olive oil mills (OOMs) by evaluating the degree of circularity through tailored indicators and conducting a techno-economic analysis (TEA) of selected practices. Together, these methods offer a robust, quantitative assessment of the environmental and financial sustainability of CE initiatives within the olive oil industry.
1. Introduction
Olive oil production is a key economic activity in the European Union (EU), accounting for around 69% of global output [1]. However, the extraction process generates substantial waste, including olive mill solid waste and olive mill wastewater (OMWW), which, despite containing valuable bioactive compounds, is highly toxic to the environment [2]. In many cases, OMWW is discharged untreated into soils and water bodies, causing serious ecological harm [3].
To address these environmental challenges, the adoption of CE principles is critical. This transition requires systemic changes across the olive oil supply chain, particularly at the level of OOMs, which are positioned as key drivers of micro-level transformation. Implementing CE demands operational restructuring and the integration of eco-innovations into business models [4].
This study evaluates CE implementation in Greek OOMs using a dual approach: (1) circularity assessment through sector-specific indicators, and (2) TEA of selected CE practices. The combined methodology provides a comprehensive understanding of CE performance, supporting both industry decision-making and policy development for a more sustainable and circular olive oil sector in Greece.
2. Methodology
A comprehensive literature review conducted prior to methodology design confirmed the close relationship between CE and sustainability. While CE is typically linked to environmental and economic benefits, its full alignment with sustainable development requires incorporating social, environmental, and economic dimensions. Accordingly, this study adopts a mixed-methods approach to evaluate CE implementation in Greek olive mills, structured around these three pillars.
The methodology comprises two components: (i) a circularity assessment using sector-specific indicators focused on resource efficiency, waste reduction, by-product reuse, energy use, and water management [5,6]; and (ii) a techno-economic analysis (TEA) evaluating the financial viability of selected CE practices. Data were collected through structured questionnaires during on-site visits to 10 olive mills in Serres, Northern Greece. Indicators were quantified and normalized to allow cross-facility comparison. The TEA calculated financial metrics such as Net Present Value (NPV) (10 years, 4%), Internal Rate of Return (IRR), and Payback Period, Net Profit (Before Depreciation) or Earnings Before Depreciation, Initial Investment (CAPEX- Capital Expenditures), ROI (Return on Investment), PI (Profitability Index). The integrated results offer a comprehensive evaluation of CE performance, identifying best practices and barriers. These insights inform strategic recommendations for enhancing sustainability in the olive oil sector.
3. Results
Following the processing and analysis of the collected data in Microsoft Excel (Microsoft 365 MSO, Version 2408), the circularity scores of the sampled olive mills were compiled into a summary table. As shown in Table 1 and Table 2, the results indicate a moderate level of circularity across the facilities, with circularity rates ranging from a minimum of 36% to a maximum of 54%. Notably, most mills do not implement water optimization practices during the oil extraction process—only two facilities reported such measures, and their contribution to overall circularity was marginal.
As evidenced in Table 1 and Table 2, the OOMs studied demonstrate environmentally responsible land use, avoiding soil degradation or applying remediation where needed. Waste management practices are uniformly circular, focusing on by-product reuse and recycling. However, energy-related circular actions are limited, with only two mills adopting measures for energy production or self-sufficiency. The social pillar of circularity is largely neglected, with minimal socially oriented initiatives reported (Table 1 and Table 2). According to Table 3, from an economic perspective. despite two-phase mills have made substantial investments in circular infrastructure, circularity levels remain moderate (<50%). This suggests that physical investment must be complemented by operational efficiency and strategic integration of circular economy (CE) principles.
As shown in Table 4, although certain three-phase OOMs attain a positive NPV from specific circular practices, the majority exhibit negative NPVs over a 10-year period, indicating limited economic viability and potential long-term financial liabilities. Operational costs frequently exceed revenues, adversely affecting profitability indicators such as net profit margin, Payback Period, and PI. In several instances, the profitability index was notably low—for example, generating returns of only €0.25 or €0.01 per €1 invested—underscoring significant economic inefficiencies and limited financial returns from CE investments in most three-phase mills (Table 4).
4. Discussion
In the environmental dimension of CE implementation, OOMs show partial alignment with sustainability goals. While waste management and soil protection practices are generally well adopted, water use optimization remains largely unaddressed, despite its importance. As highlighted in previous research, water management plays a critical role in accurately assessing the circularity of agri-food systems. In the study by [7], a slight advantage was consistently observed for two-phase decanters compared to three-phase systems. This difference is likely attributable to the reduced volume of water required in two-phase processing. Despite its significance, the integration of water-related parameters into circularity metrics remains limited in the current literature [8], indicating a gap that warrants further investigation for more comprehensive circularity assessments in agri-food systems. Additionally, circular strategies for energy self-sufficiency—such as energy recovery or renewable integration—are rarely implemented, limiting environmental performance.
Social aspects of CE are also underdeveloped. Most OOMs lack initiatives aimed at improving social equity, worker well-being, or community engagement, revealing a significant gap in the social sustainability of CE adoption.
In this pilot study, from an economic perspective, two-phase olive oil mills (OOMs) have demonstrated significant investments in circular infrastructure. However, they continue to exhibit only moderate levels of circularity, likely attributable to persistent operational inefficiencies. While certain three-phase mills have realized economic benefits from circular economy (CE) practices—evidenced by positive net present values (NPVs)—the majority exhibit negative NPVs over a 10-year horizon, suggesting limited financial viability. Furthermore, many of these mills operate with annual expenditures surpassing revenues, resulting in low profitability and suboptimal returns on investment.
These results underscore the critical need for enhanced business models and improved operational efficiency to strengthen the economic sustainability of CE initiatives within the olive oil sector. This conclusion aligns with the findings of [8], who emphasize that a successful transition to a circular economy must be predicated on the generation of economic value. Consequently, future development of circular practices in this context may benefit from the integration of high-value-added by-products, with potential applications across various sectors, including cosmetics, pharmaceuticals, and fertilizers [8].
Overall, the circularity assessment of this Greek pilot sample revealed moderate levels of circularity for both three-phase (36–47%) and two-phase (39–54%) olive oil mills. This observation is consistent with previous research in the olive oil sector. For instance, Ref. [9] reported comparable circularity performance, with Material Circularity Indicator (MCI) values ranging from 0.53 to 0.68 (i.e., 53–68%), depending on the specific assumptions adopted and the types of decanters utilized.
5. Conclusions
To ensure the long-term sustainability and competitiveness of the olive oil industry, it is essential to valorize waste streams into high-value products through the strategic implementation of circular economy (CE) principles. The CE framework promotes enhanced resource efficiency, reduction in environmental impacts, and compliance with increasingly stringent environmental regulations. In this context, the use of circularity indicators—particularly those adapted to the agri-food sector—can support the systematic evaluation and monitoring of CE implementation.
However, findings from this pilot study reveal that olive oil mills (OOMs) currently demonstrate only moderate levels of circularity, despite considerable investments in circular infrastructure. This suggests that capital investment in physical assets alone is insufficient to catalyze systemic transformation. Instead, there is a pressing need for improved business models and operational strategies that align economic performance with circular goals.
Targeted, low-cost interventions in day-to-day operations could play a significant role in enhancing circularity outcomes. For example, the installation of water recycling and reuse systems for the olive-washing process can substantially reduce water consumption, decrease operational costs, and improve overall circular performance. Additionally, the adoption of photovoltaic systems for on-site energy generation can offer both financial benefits and increased energy autonomy. Further, the valorization of waste by-products through collaborations with industries such as cosmetics and pharmaceuticals presents an opportunity for the generation of high-value revenue streams. However, the feasibility of these strategies may be influenced by the presence of relevant industrial actors in the region or may necessitate the establishment of partnerships at the national or international level.
More broadly, the CE is increasingly recognized as a viable alternative to conventional linear economic models by fostering regenerative, restorative, and preventative industrial practices. Nevertheless, its global implementation remains limited, often constrained to technologically driven solutions focused primarily on recycling. This narrow focus frequently overlooks more impactful circular strategies, such as product reuse, process optimization, and demand-side resource reduction. As demonstrated in this study, achieving meaningful progress toward sustainability and circularity in the olive oil sector will require not only technological innovation, but also comprehensive policy support and a deeper integration of CE principles across all levels of the value chain.
Author Contributions
Conceptualization, A.K. and A.P.; methodology, A.K., A.P. and M.T.; software, A.K.; validation, A.K.; formal analysis, A.K.; investigation, A.K.; resources, A.K.; data curation, A.K.; writing—original draft preparation, A.K.; writing—review and editing, A.K.; visualization, A.K.; supervision, A.P. and M.T.; project administration, A.K. and A.P. All authors have read and agreed to the published version of the manuscript.
Funding
This research received no external funding.
Institutional Review Board Statement
Not applicable.
Informed Consent Statement
Not applicable.
Data Availability Statement
The original contributions presented in this study are included in the article. Further inquiries can be directed to the corresponding author.
Conflicts of Interest
The authors declare no conflicts of interest.
Abbreviations
The following abbreviations are used in this manuscript:
| CE | Circular Economy |
| OMMs | Olive Oil Mills |
| NPV | Net Present Values |
| TEA | Techno-economic Analysis |
References
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Table 1.
Assessment of Environmental and Social Part of Circular Economy of Two-Phase Olive Oil Mills.
Table 1.
Assessment of Environmental and Social Part of Circular Economy of Two-Phase Olive Oil Mills.
| Sustainability Pillar | Category | 2PH_1 | 2PH_2 | 2PH_3 | 2Ph_4 | 2Ph_5 |
|---|---|---|---|---|---|---|
| 1. ENVIRONMENTAL |
| 75% | 100% | 75% | 100% | 75% |
| 0% | 0% | 0% | 0% | 0% | |
| 100% | 100% | 100% | 100% | 100% | |
| 0% | 80% | 0% | 0% | 0% | |
| 100% | 100% | 100% | 100% | 100% | |
| 0% | 0% | 0% | 0% | 0% | |
| 2. SOCIAL |
| 3% | 0% | 0% | 0% | 0% |
| TOTAL CE (ENVIRONMENTAL AND SOCIAL) | 40% | 54% | 39% | 43% | 39% | |
Table 2.
Assessment of Environmental and Social Part of Circular Economy of Three-Phase Olive Oil Mills.
Table 2.
Assessment of Environmental and Social Part of Circular Economy of Three-Phase Olive Oil Mills.
| Sustainability Pillar | Category | 3Ph_1 | 3Ph_2 | 3Ph_3 | 3Ph_4 | 3PH_5 |
|---|---|---|---|---|---|---|
| 1. ENVIRONMENTAL |
| 50% | 50% | 50% | 50% | 50% |
| 9% | 21% | 0% | 0% | 0% | |
| 100% | 100% | 100% | 100% | 100% | |
| 70% | 0% | 0% | 0% | 0% | |
| 100% | 100% | 100% | 100% | 100% | |
| 0% | 0% | 0% | 0% | 0% | |
| 2. SOCIAL |
| 0% | 0% | 0% | 0% | 0% |
| TOTAL CE (ENVIRONMENTAL AND SOCIAL) | 47% | 39% | 36% | 36% | 36% | |
Table 3.
The economic dimension of circular economy (CE) implementation of two-phase OOMs.
| Sustainability Pillar | Category | 2PH_1 | 2PH_2 | 2PH_3 | 2PH_4 | 2PH_5 |
|---|---|---|---|---|---|---|
| 3. ECONOMY |
| 273,470€ | 81,000€ | 145,000€ | 61,750€ | 27,450€ |
| 124,900€ | 43,500€ | 76,500€ | 31,900€ | 23,100€ | |
| 148,570€ | 37,500€ | 68,500€ | 29,850€ | 4350€ | |
| 800,000€ | 450,000€ | 480,000€ | 350,000€ | 300,000€ | |
| 40,000€ | 35,000€ | 48,000€ | 35,000€ | 25,000€ | |
| 18.57% | 8.33% | 14.27% | 8.53% | 1.40% | |
| 5.39 | 12 | 7.01 | 11.73 | 66 | |
| 477,847.85€ | 45,000€ | 99,648€ | 48,243€ | −21,110€ | |
| 15.76% | ~6.5% | ~10.3% | ~7.9% | ~3.4% | |
| 1.6 | 1.1 | 1.21 | 0.86 | −0.82% | |
| 620,000€ | 300,000€ | 320,000€ | 190,000€ | 75,000€ | |
| 78% | 67% | 67% | 54% | 25% | |
| 56,000€ | 20,500€ | 36,500€ | 26,000€ | 5000€ | |
| 20% | 25% | 25% | 42% | 18% | |
| 430,000€ | 158,000€ | 280,800€ | 178,104€ | 39,682€ |
Table 4.
The economic dimension of circular economy (CE) implementation of three-phase OOMs.
| Sustainability Pillar | Category | 3PH_1 | 3PH_2 | 3PH_3 | 3PH_4 | 3PH_5 |
|---|---|---|---|---|---|---|
| 3. ECONOMY |
| 203,300€ | 50,690€ | 84,750€ | 48,250€ | 59,400€ |
| 57,200€ | 46,490€ | 84,360€ | 36,050€ | 65,200€ | |
| 146,100€ | 4200€ | 390.00€ | 12,200€ | −5800€ | |
| 740,000€ | 140,000€ | 330,000€ | 230,000€ | 260,000€ | |
| 37,000€ | 7000€ | 16,500€ | 11,500€ | 13,000€ | |
| 19.74% | 3.00% | 0.12% | 5.30% | −2.23% | |
| 5.07 | 33.33 | Unprofitable | 18,85 | Unprofitable | |
| 511,747€ | −105,688€ | −326,538€ | −128,505€ | −306,289€ | |
| 16.37% | 1.85% | −3.84% | 0.76% | −5.39% | |
| 1.69 | 0.25 | 0.01 | 0.44 | 0.02 | |
| 15,000€ | 0.00€ | 0.00€ | 0.00€ | 0.00€ | |
| 2% | 0% | 0% | 0% | 0% | |
| 29,600€ | 1190€ | 6000€ | 1000€ | 3000€ | |
| 15% | 2% | 7% | 2% | 5% | |
| 225,082.52€ | 9702.20€ | 48,915.60€ | 8152.60€ | 24,457.81€ |
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Kounani, A.; Pavloudi, A.; Tsiouni, M. Economic Aspects of the Circular Food Economy: The Case of Olive Oil. Proceedings 2026, 134, 49. https://doi.org/10.3390/proceedings2026134049
AMA Style
Kounani A, Pavloudi A, Tsiouni M. Economic Aspects of the Circular Food Economy: The Case of Olive Oil. Proceedings. 2026; 134(1):49. https://doi.org/10.3390/proceedings2026134049
Chicago/Turabian StyleKounani, Aristea, Alexandra Pavloudi, and Maria Tsiouni. 2026. "Economic Aspects of the Circular Food Economy: The Case of Olive Oil" Proceedings 134, no. 1: 49. https://doi.org/10.3390/proceedings2026134049
APA StyleKounani, A., Pavloudi, A., & Tsiouni, M. (2026). Economic Aspects of the Circular Food Economy: The Case of Olive Oil. Proceedings, 134(1), 49. https://doi.org/10.3390/proceedings2026134049
