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What are Upstream Impacts?

Published in Supply Chain Impacts 3 mins read

Upstream impacts refer to the effects that occur during the initial phases of a product or service's lifecycle, specifically everything that went into the production of that product before it got to you, the consumer, including the extraction of natural resources, the manufacturing, the transportation, etc. These impacts can be environmental, social, or economic and happen long before a product reaches the end-user.

Understanding upstream impacts is crucial in evaluating the true cost and sustainability of goods and services. Unlike downstream impacts, which relate to disposal and end-of-life, upstream effects cover the foundational activities required to create something.

Key Upstream Stages and Potential Impacts

The upstream phase encompasses several distinct stages, each with its own set of potential impacts. The provided reference highlights the core activities:

1. Resource Extraction

This is the very first step, involving obtaining the raw materials needed for a product.

  • Activities: Mining minerals, logging forests, drilling for oil/gas, harvesting agricultural products, abstracting water.
  • Potential Impacts:
    • Environmental: Habitat destruction, soil erosion, water pollution, greenhouse gas emissions, biodiversity loss.
    • Social: Displacement of communities, labor issues (e.g., working conditions, child labor), land rights disputes.
    • Economic: Resource depletion, fluctuating commodity prices.

2. Manufacturing and Processing

Raw materials are transformed into usable components and finished goods in this stage.

  • Activities: Refining raw materials, factory production, assembly, chemical processing.
  • Potential Impacts:
    • Environmental: Air and water pollution (e.g., chemical runoff, particulate matter), energy consumption (often from fossil fuels), waste generation, hazardous material handling.
    • Social: Worker health and safety issues, fair wages, community health impacts from pollution.
    • Economic: Efficiency of production, technological development costs.

3. Transportation (Upstream Logistics)

Moving raw materials to processing plants, components to assembly factories, and finished goods to distribution centers (before reaching the consumer).

  • Activities: Shipping by road, rail, sea, and air; operating logistics hubs.
  • Potential Impacts:
    • Environmental: Greenhouse gas emissions (major contributor), air pollution, noise pollution, potential spills.
    • Social: Infrastructure demands, community disruption along transport routes.
    • Economic: Fuel costs, logistical efficiency, supply chain reliability.

Comparing Upstream and Downstream

The reference clearly distinguishes upstream from downstream.

Aspect Upstream Impacts Downstream Impacts
Timing Before the product reaches the consumer After the product is disposed of by the consumer
Activities Resource extraction, manufacturing, initial transportation Disposal, recycling, waste management, decomposition
Focus Raw material acquisition, production processes, early logistics End-of-life treatment and fate

Understanding both is essential for a complete lifecycle assessment of a product's total impact.

Why Upstream Matters

Focusing solely on the product in hand or its disposal misses the significant footprint created during its creation. Addressing upstream impacts involves:

  • Sustainable Sourcing: Choosing materials extracted responsibly.
  • Cleaner Production: Implementing energy-efficient and less polluting manufacturing processes.
  • Efficient Logistics: Optimizing transport routes and modes to reduce emissions.
  • Designing for Reduction: Creating products that require fewer resources in the first place.

By considering upstream activities, businesses and consumers can make more informed decisions that lead to reduced environmental burden and improved social outcomes throughout the entire value chain.

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