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The main aim of study is examing farmers understanding towrds the emerging concepts of sustainable agricultural waste management falls under circular agriculture-a circular, green economy with cleaner production and bioeconomy reconciled with economic, social and environmental dimensions. This study is a prototype in Mirab Gojjam Zone of Amhara region as well in Ethiopia. we seek to determine farmers’ willingness-to-pay (WTP) for eco-friendly AWM. Data were collected through a contingent valuation survey of 353 randomly selected farmers in Mirab Gojjam. The improper discarding and unsafe use of agricultural waste causes health and environmental problems. It also contributes to GHG emissions, particularly in Mirab Gojjam, the focus of our study. We thus assessed farmers’ WTP for eco-friendly AWM to improve the local environment in Mirab Gojjam and maintain low carbon sustainable development. The result indicates an annual WTP of 6.84 household days (equivalent to 273.5 Birr) for the surveyed farmers. The Tobit results indicate that the social capital, socioeconomic, cognitive, and altruism variables significantly influence the degree of WTP. Our results are thus useful for understanding farmers’ attitudes and WTP for eco-friendly AWM, as well as the need for private and public instruments in agricultural waste for developing and disseminating resource technology.To improve the use of agricultural waste in biofuel, construction, and feedlot and to enhance sources of rural income, green marketing and low-carbon innovative recycling technologies should be established parallel to proper discarding. In our study, the mean WTP in labour days per year was higher than the amount of money farmers that were willing to pay for eco-friendly AWM.We thus propose three suggestions for sustainable and eco-friendly AWM. First, the government must assess and understand the current generation potential of agricultural waste. It must formulate rural sustainable waste management policies and create awareness accordingly.Second, agricultural waste recycling technology should be provisioned in rural areas through public–private collaboration. The vacuum in the local waste recycling market should be addressed by opening the market to private and informal micro-enterprise sectors, along with full government support.Lastly, proper follow-up and inspection is important to ensure all parties function in accordance with the laws, norms, and policies.Generally speaking, AWM must be prioritised as much as other SDGs to sustain holistic development, cleaner production, and clean-living environments for reducing carbon emission and looping conventional waste into circular agriculture.