Welcome to the second module of the Circular Economy Capacity Building Program!
This week we’re diving deeper into understanding the circular economy, and it’s all to do with butterflies. Watch the video first and then have a read about this very helpful tool for understanding materials management in a circular economy: the Butterfly Diagram.
Data Time: Material Flows in the Nursery Industry
Check out this data on material flows gathered by Nursery & Garden Industry Australia. They give a clear picture of where there is room for improvement in the industry, and highlights the importance of data gathering in measuring and evaluating circular initiatives, like our own pot re-use scheme.

Materials Circulation Framework: A guide to “what good looks like” for materials management
When we extract resources from nature, whether through mining or agriculture & horticulture, we transform them into the products and materials that fuel our societies and economies. Once these products enter our economy, it’s essential to understand how they should be managed & circulated to retain their value. That is the purpose of the Butterfly Diagram, a guiding tool for how to circulate materials at their highest value for as long as possible.
Of course the most effective material management strategy is to rethink if we need the material at all, but if we do decide to bring a material into circulation, the Butterfly Diagram is our guide!
The Butterfly Diagram (Figure 1) separates materials into two main types: technical materials (like plastic, steel, and electronics) and biological materials (like plants, timber, food, and textiles). Each type follows its own pathway in the circular economy.

Technical Materials
Let’s begin with technical materials, the right side of the Butterfly Diagram. These materials are finite, which means we cannot grow more once they are extracted. Therefore, in a circular economy the focus is on keeping them in use for as long as possible, through one of nine technical materials circulation strategies, with maintenance & reuse as a priority and recycling & waste–to–energy as a last resort in the technical circulation hierarchy.
TECHNICAL MATERIALS |
Definition: Technical materials are hard durables made from extracted resources & manufactured by humans, such as plastics, glass, aluminium, concrete, and steel. |
Systems perspective: What we have is all we have. Overall, we shouldn’t use too many of these, and what we do use, we should circulate as long as possible following the technical circulation hierarchy below. |
Technical materials circulation hierarchy:
R1. Refuse: Prevent raw material use R2. Reduce: Decrease raw material use R3. Renew: Redesign product in view of circularity R4. Reuse: Use product again R5. Repair: Maintain and repair product R6. Refurbish: Revive product R7. Remanufacture: Make new product from second hand R8. Repurpose: Reuse product but with other function R9. Recycle: Salvage material streams with highest possible value R10. Recover: Incinerate waste with energy recovery |
For the nursery industry, reusable plant pots can be returned by customers, sterilised, and reused to grow new plants, reducing the need for new pots. In the case of repairing, an example could be the damaged drip irrigation lines that can be repaired by patching or replacing sections rather than purchasing an entirely new system. Finally, if no longer reusable due to degradation, plastic pots could be remanufactured by partnering with plant pot suppliers to directly turn old plant pots into new ones. Unusable pots could be collected from nurseries, cleaned and melted down into new pots or trays for continued direct use in the nursery (rather than being recycled into products we don’t need, or evading capture & ending up as pollution in the system).
Biological Materials: Regenerate and Cascade
Now, let’s look at biological materials, the left side of the Butterfly Diagram. These materials come from renewable resources, which means they can regenerate naturally. However, it’s important to remember that we must not extract these faster than the natural regeneration rate of the Earth, lest we exhaust the Earth’s capacity to produce and provide life-giving services. As such, we should extend their use by directing them through cascades. Biological materials, such as plants, timber, food, or natural fibre textiles, can safely re-enter the natural cycle. These materials decompose without harm and can return to the earth as compost or nutrients, supporting ecosystem regeneration.
BIOLOGICAL |
Definition: Biological materials are materials derived from, or produced by, biological organisms like plants, animals, bacteria, fungi and other life forms. Biological materials include things like plants, food, cardboard and other biodegradable packaging, timber, and office supplies. |
Systems perspective: Biological materials should not be extracted at a faster rate than their natural regeneration, as this can exhaust Earth’s capacity to produce. Biological materials should be treated like nutrients for ecosystems, so that they can continue their ability to replenish and grow more renewable resources. In order to circulate biological materials, management should follow the biological material circulation hierarchy below. |
Biological material circulation hierarchy:
R1: the optimal use of natural resources (e.g. soil, water and biodiversity). Another possibility is that of producing products that will replace those with a large environmental impact R2: reduction in food waste R5: the reuse of residual flows of food, feed, materials and fertiliser/compost. R5.1 – Residual flow used in food products and animal feed R5.2 – Residual flow used as a resource in industry R5.3 – Residual flow used as fertiliser and compost R6: the use of residual flows to generate energy.
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Biological materials are particularly relevant to the horticulture industry, tying in with the industry’s inherent values of regeneration & care for land, and many practices that are already inherent to the industry, such as composting.
Given horticulture’s relative maturity in biological materials circulation, the industry has an opportunity to have an outsized impact on how these materials circulate in our economy. The industry’s expertise and experience in natural cycling of materials indicates that it is in a prime position to influence actors around it: suppliers; customers; and local communities. For some of us, this may even represent an opportunity for diversification into new offerings that can expand our market segments.
For example, Cirque du Soil, a Melbourne-based organisation connecting materials throughout the community, is offering multiple, innovative services that are leveraging their expertise in biological materials & natural cycles. They are now partnering with Moonee Valley City Council to offer an Organics Advisory Service to local businesses as a part of Council’s Let’s Go Zero program. They are also starting a Compost Shop, leveraging their Community Waste collectives to aggregate and sell compost material in a centralised location.
Bridging Biological and Technical Cycles: Enablers of material circulation
The Butterfly Diagram helps us to understand how materials should be circulated, but there are other factors, such as new, circular design techniques & commercial models, that will create the enabling conditions for both biological & technical materials circulation.
After all, many changes will need to be made for a true circular economy- an important reminder that a circular transition cannot be achieved without collaboration; between our own industry, with our suppliers, our customers, and our local communities.
We’ll be covering these enabling tools in our upcoming modules. Please don’t hesitate to reach out in the meantime!