Material Flow Cost Accounting: A decision‐support framework for integrating economic and environmental dimensions in livestock manure management

Abstract

Livestock manure presents a paradox: It is simultaneously a valuable nutrient and energy resource and if managed improperly, it will also become a source of greenhouse gas emissions and water pollution. Current farm‐level assessment tools typically operate in silos. Lifecycle assessments evaluate environmental impacts, nutrient budgets track material flows, and farm economics assess costs, but no single tool integrates all three dimensions simultaneously. This fragmentation leaves hidden inefficiencies off the balance sheet and hinders decision‐making by farmers and advisors. We propose Material Flow Cost Accounting (MFCA), standardized under ISO 14051, as an integrative framework for livestock manure management that couples physical accounting (material flows and losses) with financial accounting (direct and indirect costs). By monetizing environmental losses (e.g., ammonia volatilization as lost fertilizer value) as “negative products,” MFCA reframes these losses as explicit economic costs, revealing win‐win opportunities where emissions reductions and cost savings align. We outline MFCA's principles, present a structured operational framework adapted to livestock manure, and discuss implications for farm‐level decision‐making and management optimization. We conclude that MFCA can integrate with existing or new models to organize physical and financial data into a unified, economically transparent decision‐support structure. When validated on commercial farms, integrated with dynamic process models, and implemented via accessible digital tools, MFCA has potential to reframe manure from a compliance burden into a quantifiable asset within a circular bioeconomy.