The trend and challenges of resource utilization of agricultural and animal husbandry waste

Against the backdrop of the deep integration of the "dual carbon" goal and rural revitalization strategy, the resource utilization of agricultural and animal husbandry waste has evolved from a simple environmental issue to a core proposition related to sustainable agricultural development.
In 2026, the No. 1 central document clearly proposed to strengthen the comprehensive treatment of livestock and poultry manure and improve the comprehensive utilization capacity of straw. Driven by strong policies, the industry is rapidly developing along the track of scale, marketization, and high value. However, at the same time, deep-seated bottlenecks in the industrial chain and market mechanism obstacles are becoming increasingly prominent. This article will systematically review the three major trends in current industry development, analyze the three core challenges faced, and propose breakthrough paths for the future based on this.

1、 Industry Development Trends Driven by Policies
1. The policy system is becoming increasingly perfect
The green development of agriculture has been elevated to a national strategic level, forming a policy system with clear goals and diverse incentives. The "14th Five Year Plan for National Agricultural Green Development" sets key targets of achieving comprehensive utilization rates of over 86%, 80%, and 85% for straw, livestock manure, and agricultural film, respectively, by 2025. The Ministry of Agriculture and Rural Affairs disclosed in January 2026 that the above core goals have been basically achieved: the comprehensive utilization rate of livestock and poultry manure, straw, and agricultural film disposal rate in China have reached 80.1%, over 88%, and over 85% respectively, and the scientific recycling system for agricultural Solid Waste has been preliminarily established.
The central government has continuously increased investment through special subsidy funds and central budget investment, forming a diversified pattern of central guidance, local support, and social capital participation. The principle of marketization has been implemented, and models such as government procurement of services and third-party governance have been widely promoted to promote the healthy development of the industry.
2. Clear and diverse technological paths
The industry technology presents a clear path of "scaling up basic technology and exploring high value at the forefront":
Dual track deepening of mainstream processing technology: anaerobic fermentation biogas production as the core of energy conversion, the annual production capacity of biogas in China has exceeded 300 million cubic meters (by the end of 2023), and is moving towards the goal of 1 billion cubic meters by 2025; The "combined heat, power and fertilizer" model is mature. Aerobic fermentation (composting), as the backbone of fertilization, with its low threshold and direct connection with agriculture, is the key to building a localized "planting and breeding cycle", and efficient processes are accelerating their promotion.
Combining comprehensive utilization with high-value exploration: straw forms a "five material" utilization pattern, with fuel and fertilizer utilization as the main focus. At the same time, the industry is expanding into higher value areas, such as the preparation of biobased materials (PLA), insect protein feed, and biochar, which are transitioning from demonstration to industrialization and driving industrial upgrading.
3. Steady growth in market size
Driven by the dual goals of "dual carbon" and rural revitalization strategy, the industry market space continues to be released.
Market size: It is predicted that the market size of China's agricultural and animal husbandry waste resource utilization industry (including equipment, products, and services) has exceeded 300 billion yuan, and is expected to maintain steady growth during the "15th Five Year Plan" period.
Industry model: A typical "collection and storage+processing+product application" industry chain has been formed in various regions. For example, in areas with abundant straw resources, a number of specialized collection, storage, and transportation service organizations and large-scale utilization enterprises have emerged. In a major livestock county, the county's promotion of livestock and poultry manure resource utilization projects has given rise to regional centers for Organic Fertilizer production and biogas energy supply.
Industrial integration: The integration with modern agriculture, Clean Energy, and environmental protection industries is becoming increasingly close. For example, biogas slurry is used as a high-quality liquid fertilizer in ecological orchards and tea gardens; Integrating bio natural gas into urban and rural gas pipelines or using it as vehicle gas; Biochar is used for soil improvement and restoration, achieving the unity of environmental and economic benefits.

Despite the rapid development of the industry, it still faces a series of practical difficulties, and breaking through these bottlenecks is the key to the industry moving towards high-quality development.
Challenge 1:
The economic and technological bottlenecks of the entire industry chain need to be overcome
Operational bottleneck:
High front-end storage costs: Waste materials such as straw and livestock manure have the characteristics of dispersion, strong seasonality, and large volume. The cost of collection, storage, and transportation is high, accounting for a large part of the total processing cost and directly affecting the economic viability of the project.
Partial lack of technical and economic feasibility: Although high-value technologies such as insect protein conversion and biobased material preparation have broad prospects, many are still in the pilot or demonstration stage. Large scale applications require high investment and operating costs, and market competitiveness needs to be verified, leading to cautious investment by enterprises.
High pressure on facility operation: For breeding entities, the construction and maintenance costs of professional manure treatment facilities (such as large-scale biogas projects) are high. If organic fertilizers and other products are not sold smoothly or priced low, it is easy to lead to project operation losses and dampen the enthusiasm of the entities.
Solution path:
Promote comprehensive solutions and technology integration: Encourage the development of regional and intensive storage and transportation service systems, and reduce single ton costs through specialization and scale. Key support will be given to the optimization and promotion of mature co production technologies such as anaerobic fermentation biogas power generation organic fertilizer production, in order to enhance the overall profitability of the project.
Strengthen key technology research and industrialization support: Establish a special R&D fund to support cooperation between universities, research institutes, and enterprises in tackling the challenges of cost reduction, efficiency improvement, and engineering scaling up of high-value utilization technologies. Accelerate the transition of new technologies from the laboratory to the market through the construction of industrial demonstration projects.
Improve the full chain business model: promote the establishment of an integrated regional circulation model of "breeding processing planting", or through models such as "company+farmers" and third-party professional services, clarify the interests of all parties, share investment and market risks, and enhance the overall stability and efficiency of the industrial chain.
Challenge 2:
There are obstacles between product marketization and standard system
Operational bottleneck:
The product standards are not unified, and the market recognition needs to be improved: the quality of organic fertilizers, biochar and other products produced by different raw materials and processes varies greatly, and the current standard system is not yet perfect, which makes it difficult for high-quality products to be priced well. The market is mixed with good and bad, affecting the confidence of downstream users.
Insufficient motivation to use organic fertilizers on the planting end: Compared with chemical fertilizers, organic fertilizers have problems such as slow fertilizer efficiency, large volume, inconvenient application, and relatively high unit nutrient cost. Especially for field crops, the economic driving force for farmers to switch to organic fertilizers is not strong.
Solution path:
Accelerate standard setting and brand building: Promote industry associations and leading enterprises to take the lead in developing more segmented and stringent product group standards and quality certification systems. Using blockchain and other traceability technologies to establish reliable product quality endorsements, cultivate high-quality brands, and open up market trust channels.
Increasing incentives and supporting services for terminal application: The government can directly reduce costs for farmers by linking subsidies for land fertility protection with the use of organic fertilizers, and providing subsidies for the application process. At the same time, support the development of socialized services such as mechanized application of organic fertilizers and field distribution, and solve the convenience problem of the "last mile".
Strengthen publicity guidance and demonstration: By establishing long-term positioning experimental fields and selecting demonstration farmers, visually demonstrate the comprehensive benefits of long-term application of organic fertilizers on soil improvement, agricultural product quality improvement, and yield and stability increase, and transform planting concepts.
Challenge Three:
The policy and funding support system need to be continuously optimized
Operational bottleneck:
The total amount of support funds is limited and unevenly distributed: the central and local fiscal subsidies are still insufficient for the huge market demand, and are mostly concentrated in the facility construction process. Many animal husbandry counties are financially constrained and unable to provide sufficient supporting funds and subsequent operational support.
The market-oriented incentive mechanism is not sound: current policies have strong constraints on "pollution control", but there is still room for strengthening market-oriented incentives for "resource utilization" (such as tax incentives for organic fertilizer products, full guarantee purchase of biogas power generation, realization of carbon emission reduction value, etc.), making it difficult to fully stimulate endogenous market forces.
Solution path:
Innovative financial support and diversified investment and financing models: Actively promote the PPP (government social capital cooperation) model and guide social capital participation. Explore the development of green credit and green bonds, and include manure resource utilization projects in environmental equity markets such as carbon emission trading and green electricity certificate trading, to broaden project revenue channels.
Promote precise support for policies from "construction" to "use": optimize subsidy structure, while ensuring initial investment subsidies, explore subsequent operational subsidies based on actual processing capacity, power generation capacity, or carbon reduction emissions. Develop more operational guidelines and implement preferential policies for biogas power generation and biogas integration into the grid.
Strengthen assessment and systematic management: Incorporate the stable operation rate and high-value level of resource utilization such as livestock manure and straw into local government performance assessment, promote the establishment of cross departmental (agriculture, environmental protection, energy, finance) collaborative management mechanisms, and form policy synergy.

3、 Conclusion
In summary, the industry of agricultural and animal husbandry waste resource utilization is at a critical turning point from "large-scale treatment" to "high-value utilization". Under the strong driving force of national strategy, policies, technology, and markets have formed a preliminary synergy, promoting an increasingly solid industrial foundation and clear development path.
However, true industrial maturity and sustainable development depend on the ability to systematically overcome the multiple bottlenecks that currently exist between economic costs, technological transformation, market acceptance, and policy coordination. This requires a shift from a simple engineering project construction mindset to building a comprehensive industrial ecosystem that encompasses technological innovation, business models, standard systems, financial instruments, and cross departmental governance.
In the future, the value of the industry will not only be reflected in pollution reduction and environmental improvement, but also deeply integrated into the national strategic framework of food security, energy security, and ecological security. Through continuous technological iteration, refined policy design, and effective market cultivation, the former "environmental burden" will be more efficiently transformed into a "valuable resource" to support the green, low-carbon, and circular development of agriculture, contributing an indispensable cornerstone force to the comprehensive rural revitalization and the construction of a beautiful China.