Resource constraints on suppliers

On identifying suppliers that are constrained by the availability of resources

Constraints are generally less likely to play a role in the long term than in the short term. Due to the long-term perspective normally used for LCA, full elasticity of supply is therefore typically assumed, also in relation to raw material supply. But even in the long-term perspective, specific raw materials or technologies may be constrained.

If the necessary production factors, notably raw materials, are only available locally or are already fully utilised, this is a constraint that needs to be included in the analysis. An example of such resource constraints is the availability of freshwater, which may be constrained in areas with limited rainfall. Hydropower is another example of a resource-constrained technology. On an expanding market for a material, we find that the availability of recycled material will provide a constraint for the recycling industry.

For products that do not store easily and for products and semi-manufactured materials with a low price to weight ratio (such as biomass for energy and paper pulp), transport distances and infrastructure can impose a constraint on products and materials not produced locally. The waste treatment capacity may be a constraint on processes with specific hazardous wastes.

For multi-product processes, supply of a co-product may be constrained if it does not have a value that can sustain the production alone. In general, this will be the case if the studied product has a low value compared to the other co-products, so that the studied co-product cannot in itself provide an economic revenue that is adequate reason for changing the production volume (like animal manure versus milk and meat, or rape seed cakes versus rape seed oil), or if the market trend for the studied co-product is low compared to the market trend for the other co-products. Therefore, dependent co-products are never part of the consumption mixes in consequential models. 

Read more

• Constraints on steel production An example on identifying the marginal steel production technology.
• Marginal water supply in Israel An example on how to identify the marginal production in a situation with resource constraints.

How to cite this: Consequential-LCA (2015). Resource constraints on suppliers. Last updated: 2015-10-27. www.consequential-lca.org.