The impact of greenhouse gas emissions in the EU food chain: A quantitative and economic assessment using an environmentally extended input-output approach

In order to provide a valuable knowledge basis for future global warming mitigation strategies and policy implementation, this study carries out an integrated assessment of greenhouse gas (GHG) emissions throughout the EU-25 food supply chain, considering the highest available level of product disaggregation.Based on an environmentally extended input-output (EE-IO) approach, we estimate the environmental impacts resulting from the ‘food and non-alcoholic beverages’ supply chain from production to waste management, by 44 food products, grouped in 11 categories. Further, we perform a StructuralPath Analysis to identify the hotspots along the supply chain with the highest emissions. Finally, we carry out an assessment of the economic impact of GHG emissions on each product category, considering both the related environmental pressure intensity and the cost of environmental damage (social cost). The results offer new insights on the amount, composition and origin of GHG emissions in the food supply chain. More precisely, detailed evidence is provided in support of the findings of previous studies that have shown that the contribution of farm-level activities on overall GHG emissions is mostly related to N2O and CH4 emissions. Moreover, we highlight the large environmental impact associated with CO2 emissions, even if they are scattered among a very high number of activities, with a limited contribution each. Hence, we infer that multiple hotspots for CO2 exist along the whole supply chain and that many of them occur in downstream stages, e.g. transportation, processing, packaging, waste disposal, as well as in the cold chain activities. As for the economic assessment of emissions, the highest costs are attributed to the highest emitting product categories, but the share of social costs of these emissions as compared to the overall production value, affect each product differently. Hence, the impact of a hypothetical price control measure, introduced to internalize the social cost of emissions, would vary significantly from one product category to another. Overall, our findings suggest that, in order to achieve effective and efficient GHG mitigation in the food system, an integrated approach is required, including both concrete technological and managerial measures at various stages of the food supply chain and for specific product categories, as well as appropriate economic incentive-based mechanisms accounting for the social cost of damage (e.g. a ‘carbon tax’), that can prompt polluters to reduce their emissions along the whole supply chain.