A material economy becomes circular exactly when recovery nodes feed material back to production as fast as extraction nodes draw new material in.
loop_retention = recycling_rate * chain_connectivity
- Flow nodes — extraction, manufacturing, use and recovery nodes in the material network.
- Chain connectivity — how directly recovery nodes are linked back to upstream production.
- Recycling rate — share of end-of-life material actually recovered rather than landfilled.
- Demand pull — how strongly downstream demand draws material through the system.
Circular material flow analysis is how the EU tracks progress on its Circular Economy Action Plan targets, sector by sector.