**Abstract**

The average annual trade of over 250 thousand tons of essential oils generates over 250 million tons of distillation residues, posing environmental problems due to incineration or landfill overburden. The circular economy focuses on reducing resource inputs, waste generation, and pollution, for sustainability. Implementing circular economy principles not only mitigates environmental concerns but also creates economic opportunities by utilizing residual biomass. Nonvolatile secondary metabolites, like flavonoids and phenolic compounds, remain in plant material during essential oil distillation. These bioactive substances can be extracted from the biomass distillation residues. Instead of discarding or burning waste from essential oil production, it can be processed to make extracts. The residue can be converted into biochar, a carbon-rich material beneficial for soil improvement. Other end uses include generating combustible bio-oil and using distillation residues for mushroom cultivation. Circular economy practices in the essential oil agroindustry have implications beyond the field itself. By providing raw materials for various sectors and industries, such as agriculture, cosmetics, and pharmaceuticals, this agroindustry can contribute to broader sustainability goals. While the adoption of circular economy principles presents technological challenges, the potential benefits in terms of waste reduction, value addition, and sustainability justify ongoing research and development efforts.

**Keywords:** circular economy, essential oil, hydrosol, residual biomass, compost, flavonoid, polyphenol
