Estimating carbon footprints and economic trade-offs in Mongolia's cashmere value chain: An integrated system dynamics approach

<B>Background</B>: The growing global demand for sustainable cashmere fibre in the textile industry has driven a surge in Mongolia's cashmere goat population, intensifying concerns about rangeland degradation and greenhouse gas (GHG) emissions. However, empirical evidence on the trade-offs between economic and environmental gains remains limited.
Objective: This paper aims to assess ex-ante the impact and trade-offs of implementing upstream decarbonisation strategies, including herd management, preservation of rangeland, and trading policies within the cashmere value chain in Mongolia.
<B>Method</B>: A Type I integration of system dynamics modelling and life cycle assessment was adopted. The system dynamics model comprises five interconnected modules that simulate the interactions among cashmere production, rangeland forage, fibre processing, end-product manufacturing, and economic and environmental impacts over 20 years at an annual timestep.
Results and conclusion: Model results show that enteric fermentation and manure management account for 4.17% and 3.16% of total GHG emissions in the cashmere value chain, respectively. Electricity use during the dehairing process is a major contributor to GHG emissions, accounting for 46.79% of the total carbon footprint, followed by the transportation of dehaired cashmere to end processors, which contributes 33.5%. The results indicate that decreasing the offtake period from eight to five years at the prevailing offtake rates achieves the lowest economic-environmental trade-off at $0.17 per kg of CO 2 e reduced. Significance: The findings show that a policy prohibiting the export of scoured cashmere from Mongolia would increase the economic trade-off, resulting in a loss of $3.86 in export revenue for each kilogram of CO 2 e reduced.