Three digestate utilization scenarios for bio-fertilizer production are evaluated with life cycle assessment. The aim is to determine the environmental performance of the digestate post-treatment with the goal to decrease the loss of nitrogen and phosphorus, support circular nutrient management, and increase the substitution of mineral fertilizers. The functional unit (FU) of the study is the utilization of 1 kg dry matter raw digestate, in three scenario designs. Scenario 1 (S1) describes a system where the raw digestate is directly spread on soil. In scenario 2 (S2) the raw digestate is processed by centrifugation with two recovered phases (liquid and solid digestate), which are spread on agricultural soil. In scenario 3 (S3) a more advanced post-treatment system is modelled, where the raw digestate is phase separated with centrifugation followed by drying of the solid digestate and further processing of the liquid digestate with a membrane filtration and a reverse osmosis unit. The studied scenarios show a global warming potential ranging from −0.14 (S3) to −0.36 (S1) kg CO2 eq per FU. The fossil resource depletion per FU was decreased in scenario 1 (−0.053 kg oil eq) and scenario 2 (−0.049 kg oil eq) but increased in scenario 3 (0.002 kg oil eq). The terrestrial acidification potential ranges from 0.09 (S3) to 0.18 (S1) kg SO2 per FU. The digestate post-treatment is a sustainable solution able to tackle the problem of excess nutrients and their management in agricultural areas. It could replace conventional nitrogen removal processes (aerobic biological treatment) by a valorization chain keeping the nutrients in closed loop.