Every company that produces something also produces waste: offcuts, shavings, sawdust, processing residues, and returnable packaging. In 2024, the Italian production system generated over 172 million tons of special waste, according to the latest report from ISPRA, the Italian Institute for Environmental Protection and Research.

For many businesses, that waste is just a disposal cost. However, it can become a raw material: for the same company, for another supply chain, or for a new product. Reusing production waste reduces the need for virgin raw materials and, if done in compliance with regulations, can also lower costs.

In this article, we look at the differences between using raw materials and waste, when waste is considered refuse versus a by-product, what avenues a company has to reuse it, and how it can become a mycelium-based object.

Raw materials or waste: what changes for a company

A virgin raw material must be extracted, cultivated, or produced specifically. Even when renewable, it has its own timing and limitations. Cork is a good example: it is obtained from the bark of the cork oak without felling the tree, but the first stripping takes place after about 25 years, and subsequent ones every 9 or 10 years. In Sardinia, a regional law prohibits extracting cork from trees with less than 10 years of growth. A renewable resource, therefore, but with an availability that cannot be accelerated.

Production waste, on the other hand, already exists. It was generated by a process that occurs anyway, has already consumed energy and resources, and is renewed with every production cycle. Using it as a raw material has three effects: it reduces the demand for virgin materials, reduces the quantity to be disposed of, and transforms a cost into a value.

However, it is not an automatic advantage. Collecting, transporting, and processing waste consumes energy in turn, and in some cases, the waste is dispersed, dirty, or variable from one batch to another. To know if reuse is truly worthwhile—for the environment and for the bottom line—data is needed: quantity, quality, distance, and process. It is the same principle of the circular economy: keeping materials in use for as long as possible, but with measurable choices.

Waste, by-product, or refuse: what the legislation says

Before reusing waste, it is necessary to understand what it is under the law, because what can be done with it depends on this. In Italy, the rules are found in the Environmental Consolidation Act, Legislative Decree 152/2006.

A production residue is a by-product, not waste, when it meets all four conditions of Article 184-bis:

• it originates from a production process of which it is an integral part, and that process does not have as its primary purpose to produce it;
• it is certain that it will be used, in the same process or another, by the producer or third parties;
• it can be used directly, without treatments other than normal industrial practice;
• its use is legal, i.e., it meets product, health, and environmental requirements and has no overall negative impacts.

If just one condition is missing, the residue remains waste, to be managed with all the prescribed obligations. Waste can still return to being a resource: after an authorized recovery operation, if it meets the criteria of Article 184-ter, it ceases to be waste. This is what is known in jargon as "end of waste."

Ministerial Decree 264 of 2016 helps to prove these conditions. For example: long-term contracts between those who produce the residue and those who use it can prove the certainty of reuse. The decree also provides for a register of producers and users of by-products at the Chambers of Commerce, but the qualification as a by-product does not depend on registration: it must be demonstrated in practice.

The third condition, "normal industrial practice," is the most debated, and case law is not always consistent. For this reason, before starting a reuse project, it is advisable to have a concrete case assessed by an environmental consultant.

How to reuse production waste

The starting point is always the same: knowing which waste is produced, in what quantity, with what regularity, and with what characteristics. Without this map, none of the following paths are viable. Then, there are three possibilities.

Reuse within the company

The simplest path is to put the waste back into the same production cycle or into another process within the same company. Trimmings from one process can become raw material for a smaller product, or scraps of material can be added back into a mixture.

Transferring to another supply chain: industrial symbiosis

When waste is not useful to the company that produces it, it may be useful to another. ENEA, the National Agency for New Technologies, Energy and Sustainable Economic Development, defines industrial symbiosis as a strategy in which two or more different industries share resources so that the by-products of one become a resource for the other. In addition to materials, energy, water, services, and skills can be shared.

ENEA has created the first Italian platform to match resource supply and demand, Symbiosis, and promotes the SUN network. According to the agency, the advantages for companies range from reduced disposal costs to revenues obtained by selling waste to third parties. Small businesses, however, lag behind: a 2014 European Commission action plan estimated that 44% of large companies sold their waste to another firm, compared to only 24% of SMEs.

Regulations matter here, too. As ENEA points out, an exchange between companies can fall under waste legislation or by-product legislation, with very different consequences.

Transforming into new materials

The third path is the most creative: using waste as a raw material for a new material with a higher value than the starting point. This is known as upcycling. This includes paper produced from agro-industrial residues, textiles made from citrus waste, and materials that grow on vegetable waste thanks to mycelium, through biofabrication.

From your waste to a mycelium product

Mycelium is the network of filaments that forms the body of fungi. In nature, it grows on vegetable matter and breaks it down; in production, it can be grown on vegetable waste inside a mold, where it binds particles together to form a solid material. We explained how this works in the article on what mycelium does.

L-ife works with straw and wood waste. The same process can also start from the waste of a client company: from its production residues, it is possible to grow packaging for its products, displays for points of sale, or panels for a trade fair stand. The result is an object that tells the story of the company's supply chain using the material itself.

Not all waste is suitable. Mycelium grows on plant-based residues rich in fibers such as cellulose and lignin, and every type of waste must be tested: composition, moisture content, particle size, and consistency from one batch to the next all influence the growth and properties of the final material.

If you want to find out if your waste can become a mycelium product, write to us: we will evaluate it together.

Frequently asked questions about production waste

What is production waste?

It is the residue that a production activity generates while manufacturing its main product: offcuts, scraps, shavings, sawdust, and agricultural or food processing residues. Under the law, they can be waste or by-products, depending on whether they meet the conditions of Article 184-bis of Legislative Decree 152/2006.

What is the difference between a by-product and waste?

A by-product is a production residue that meets all four conditions of Article 184-bis of the Environmental Consolidation Act and is therefore not waste: it can be sold and reused as a material. Waste, according to Article 183 of the same text, is any substance or object that the holder discards or intends or is required to discard, and must be managed according to waste regulations, including authorized transport and treatment.

What conditions must a by-product meet?

Four, all together: it originates from a production process that does not have as its primary purpose to produce it; its reuse is certain; it can be used directly, without treatments other than normal industrial practice; and its use is legal and has no overall negative impacts on the environment and health. Ministerial Decree 264 of 2016 indicates how to demonstrate these.

What does "end of waste" mean?

It refers to the cessation of waste status, as provided for by Article 184-ter of Legislative Decree 152/2006. Waste ceases to be waste after a recovery operation, if it meets specific criteria, and returns to being a product or secondary raw material.

What is industrial symbiosis?

It is a strategy in which companies from different sectors share resources so that the waste of one becomes a raw material for another. In addition to materials, energy, water, and services can be shared. In Italy, ENEA manages the Symbiosis platform, which connects resource supply and demand between companies.

How much special waste is produced in Italy?

According to the 2026 Special Waste Report by ISPRA, the Italian production system generated over 172 million tons of special waste in 2024, an increase compared to the approximately 164.5 million in 2023.

Which waste can be transformed with mycelium?

Mycelium grows on plant-based residues rich in fiber, such as straw, sawdust, and wood shavings. However, every type of waste must be tested, because composition, moisture, and particle size influence the growth and properties of the final material.