Background and rolling updates on the forthcoming European Deforestation Regulation (EUDR)

ALERT: Is the EUDR about to be postponed?

Over the past seven days, there has been much chatter about whether the European Commission will propose postponing the EU Deforestation Regulation (EUDR).

From The Desk of CocoaRadarAnthony Myers

The European Deforestation Regulation (EUDR) is a landmark legislative framework aimed at curbing deforestation and forest degradation associated with the European Union’s consumption of commodities. Implemented by the European Commission, the EUDR targets the importation and trade of products linked to deforestation, ensuring that EU market activities do not contribute to the loss of forests globally. This regulation represents a significant step towards sustainable trade practices and the protection of vital forest ecosystems.

Summary of the European Deforestation Regulation (EUDR)

The European Deforestation Regulation (EUDR) was introduced to address the EU’s role in global deforestation through stringent measures on commodities such as cocoa, soy, palm oil, beef, wood and coffee, which are often linked to deforestation.

Key provisions of the EUDR include:

1. Due Diligence Requirements: Companies must perform due diligence to ensure their products do not originate from deforested land post-2020.

2. Supply Chain Transparency: Businesses are required to provide detailed information about the sources of their commodities and ensure traceability throughout their supply chains.

3. Enforcement Mechanisms: The regulation enforces compliance through penalties for violations, incentivizing companies to adhere to sustainable practices.

4. Reporting Obligations: Companies must regularly report their due diligence activities and findings to relevant authorities.

The EUDR seeks to reduce the EU’s deforestation footprint and encourage sustainable land use practices worldwide, contributing to global efforts to combat climate change and biodiversity loss.

Exclusive - EC response to 10 questions on the EUDR

While the cocoa sector has broadly welcomed the EUDR legislation, we can report serious misgivings about its implementation, leading to calls for it to be delayed until further guidelines from the European Commission are available.

From The Desk of CocoaRadarAnthony Myers

Update on the European Deforestation Regulation (EUDR)

As of mid-2024, the implementation of the EUDR is in full swing, with several key developments:

1. Compliance Deadlines: Companies trading in the EU have until the end of 2024 to fully comply with the regulation’s requirements. Non-compliant businesses face significant fines and market restrictions.

2. Technological Integration: Advances in technology, including satellite monitoring and blockchain, are being integrated to enhance traceability and verification of commodity origins.

3. Capacity Building: The EU is providing support to trading partner countries to improve their capacities for sustainable land management and compliance with the EUDR standards.

4. Public Awareness: Increased efforts are being made to educate consumers about the importance of deforestation-free products and encourage more sustainable consumption patterns.

European Commission to open EUDR registry to operators and traders from November 2024

The Deforestation Due Diligence Registry has been published with additional details on the EC’s regulation on deforestation-free products, as major chocolate companies urge the EU not to delay the bill.

From The Desk of CocoaRadarAnthony Myers

These updates underscore the EU’s commitment to enforcing the EUDR and its broader environmental objectives, positioning the regulation as a critical tool in the fight against global deforestation.

28 July 2024: Alarm bells ring over EUDR as chocolate companies urge urgent action from EC on implementation

An influential group of companies and organisations in the cocoa industry has called for the European Commission (EC) to use its full powers enshrined in the European Union Deforestation Regulation (EUDR) to create a special ‘Standing Committee’ to enable “urgently needed coordination and technical discussion” between the EC and operators to “ensure its timely and effective implementation by 30 December 2024.”

Mars, Ferrero, Nestlé, and Tony’s Chocolonely, along with independent watchdog Voice Network and Fairtrade Advocacy Office, signed a joint paper urging the EC to establish a robust coordination mechanism while making clear that the signatories support the new law.

The paper states that one of the first tasks of a proposed EUDR Standing Committee would be to support the provision of guidance and clarifications to member states and companies on how to prepare for EUDR compliance by December 30, 2024, including the use of the Information System.

As seen by CocoaRadar and sent to Brussels last week, the paper states that companies currently need more information and certainty on respecting specific key administrative requirements of the EUDR.

Stress-testing shows limitations of system

Alarm bells are ringing after stress-testing the Deforestation Information System (DIS), used by operators of various commodities to upload their due diligence data, which has ‘shown limitations in terms of content and speed of the Multi-Stakeholder Platform to tackle such operational issues.’

Read the full story in the link

Alarm bells ring over EUDR as chocolate companies urge urgent action from EC on implementation

The cocoa industry has called for the European Commission (EC) to create a special ‘Standing Committee’ to make sure the EUDR can be implemented on time and smoothly at the end of 2024.

From The Desk of CocoaRadarAnthony Myers

Mapping the EUDR: 10 satellite and imagery providers tracing cocoa farms

CocoaRadar scopes out 10 data companies working with cocoa operators to provide accurate polygon maps for EUDR-ready due diligence statements.

Many operators rely on open platforms like Global Forest Watch (GFW), which incorporates open data sets from GLAD, Hansen, and RADD to access near real-time information about where and how forests are changing around the world. However, many experts argue that GFW alone should not be used for EUDR compliance or business-sensitive assessments.

The key lies in how these data sets are utilized and interpreted.

In the article below, we look at 10 satellite and imagery companies that provide data to cocoa operators involved in polygon mapping farms for EUDR compliance.

Mapping the EUDR: 10 satellite and imagery providers tracing cocoa farms

CocoaRadar scopes out 10 data companies working with cocoa operators to provide accurate polygon maps for EUDR-ready due diligence statements.

From The Desk of CocoaRadarAnthony Myers

Rainforest Alliance EUDR certification holders

The Rainforest Alliance certification is one of the standards set for sustainable procurement in the cocoa sector - and other commodities.

As the industry is fully aware, certifications alone cannot prove compliance with the EUDR but can be used to support the data collection process

Therefore, the Rainforest Alliance and other certification bodies have a slight advantage in setting up systems to support producers and supply chain actors in meeting the EUDR's requirements.

In addition, the organisation says its standard requirements already align with the EUDR, and four self-selected requirements have been introduced to cover aspects of the EUDR that were not fully aligned.

“These requirements are only applicable to cocoa and coffee Farm Certificate Holders. Certified farms can choose to implement these additional requirements and have these covered in their audits to support actors further down their supply chains to comply with the EUDR and continue selling their products on the EU market,” it said.

Rainforest Alliance has published its first tranche of certificate holders that have been audited and meet additional EUDR self-selected requirements in the Rainforest Alliance’s Alignment with the EUDR Policy.

Click on the chart below for more details.

16Aug 2024: Fairtrade urges the European Commission to give more farmer support over EUDR

Fairtrade International has urged the  European Commission (EC) to offer more financial support and clarify the technical terms needed for cocoa and coffee producers to meet the 30 December 2024 European Union Deforestation (EUDR) deadline. 

While the organisation reiterates it strongly believes in the EUDR objectives to create sustainable supply chains by preventing the sale and import of forest-damaging products - in a statement to the media, it said it  is “very concerned that producer organisations will be cut off from trade with the EU market or pushed out of supply chains by larger producers not because they farm on deforested land, but because they face challenges in collecting, managing, and submitting the necessary data.”

The 2023 regulation applies to companies placing relevant commodities or products on the EU market or exporting those from it. They must demonstrate that their products are deforestation-free as of the 2020 cut-off date and are not linked to forest degradation or illegal harvesting and trade.

Fairtrade International said this is why it calls on the EC to address the regulation’s shortcomings and help the millions of small-scale farmers at risk. 

It recommends the EC needs to act immediately on:

• Provide an assessment of the EUDR’s expected impact on the most vulnerable stakeholders in the global supply chain - small-scale farmers - and their ability to comply with the regulation, the administrative burden, and the compliance costs.
• Develop a coherent EU framework strategy for supply-side partnerships with producer countries that create a space for multi-stakeholder dialogue and are linked to efficient economic and trade incentives.
• Share the promised guidance document that helps clarify the application of the law, including defining key terms, explaining the rules on the traceability requirements and data governance across supply chains, and specifying the criteria used to verify compliance. Plus, update the EUDR’s Frequently Asked Questions, which have not been updated since December 2023. The more information producers have, the easier it is for them to adapt and work to meet the new requirements.
• Provide market incentives and funding to assist small-scale farmers in complying with EUDR requirements. Farmers should not have to bear the compliance costs linked to EU laws.

Fairtrade said it had updated its Cocoa Standard (2022) and Coffee Standard (2024), which require Fairtrade-certified producers to strengthen their deforestation prevention, monitoring, and mitigation. 

“The updated Standards align with the EUDR requirements, including that farms above four hectares in size or in high-risk areas must use polygon mapping, while smaller farms and farms in low-risk areas can use single geolocation points.”

Fairtrade has partnered with tech firm Satelligence to help cooperatives collect data on their members’ farms and deforestation risks. 

The producer organisations provide geolocation data for each of their members’ farm plots. Satelligence’s platform verifies the data, detects any deforestation activity within members’ boundaries, and whether or not farms are located in protected areas. It also flags deforestation near the farm, which is essential information contributing to cooperatives’ risk assessments. Finally, the system generates reports that cooperatives can use themselves and provide to their customers or potential customers.