The EU regulation on deforestation-free products is providing small farmers with a unique opportunity to gain market access and be a privileged supplier, an environmental non-profit has told Carbon Pulse.

Nicole Rycroft, founder and executive director at Canada-based Canopy, said that despite concerns about potential unfairness to small landholders, the EU Deforestation Regulation (EUDR) will be an important chance for them.

The text was adopted in June last year and requires companies to comply from Dec. 30 2024, by collecting evidence that their products are traceable and deforestation-free.

Since its adoption, the law has sparked discussions among global industry groups and MEPs in Brussels, with some of them pointing out that the law is too difficult to implement for smallholders.

Last month, chocolate giants such as Nestle, Mars Wrigley, and Ferrero came out in defence of the regulation, urging the EU to do more to help companies meet its December start date.

Several countries have also requested the EU to postpone the regulation due to its potential impact on local economies, including seven member states – Austria, Finland, Italy, Poland, Slovakia, Slovenia, and Sweden.

In May, Australia argued that an additional 24 months would be necessary to prepare regulators and producers, while Indonesia and Malaysia lodged complaints against the EU, claiming the ban is discriminatory.

In an interview with Carbon Pulse earlier this year, the German MEP Peter Liese, who is the environment spokesperson for the centre-right European People’s Party (EPP), called the EUDR a “bureaucratic monster” that is “technically completely impossible” to implement, particularly for smallholders.

But, according to Rycroft, this is not the case. “The legislation already recognises that there’s a difference between large companies and small ones,” she said.

“There are additional requirements on larger companies in terms of the level of documentation about their upstream supplies. I think that’s an appropriate level of flexibility.”

As she pointed out, several initiatives are already emerging.

“We are already seeing some initiatives around the world, such as the Ghana Cocoa Board (Cocobod), where smallholder farmers are seeing this as an opportunity to enter the space and secure the market access,” she said.

“Cocobod is supporting farmers through a national traceability system designed to provide them with the technology needed to trace their raw materials. The national institution will also support farmers in sorting the EU bureaucracy out.”

RELIABLE CLAIMS

During the last few months, Canopy has worked with 950 brand partners and producers around the world to support them in aligning with the new law.

In terms of corporate claims, Rycroft said she believes the law will have a really significant impact by “enabling all of us to be more confident that those are actually verifiable”.

“We’re all still grappling with what it means to be nature positive, but this legislation really does close the window for business as usual logging, both in the Global North and the South,” she added.

The EU’s regulation will apply to seven commodities – cattle, cocoa, coffee, palm oil, soya, timber, and rubber, including products that contain, have been fed with, or have been made using these commodities.

According to a report released in June by Trase, a data initiative founded by nonprofits the Stockholm Environment Institute and Global Canopy, EU imports between 2019 and 2021 were linked on average to 190,500 hectares of cleared forests, an area more than 10 times the size of Brussels.

While emphasising the potential for the EUDR to reduce the bloc’s exposure to deforestation, the report pointed out that some commodities not covered by the regulation – such as maize and cashew nuts – also pose significant risks.

“The seven commodities listed under the law are a large part of the EU risk and exposure to deforestation and degradation, but this is just a start,” Rycroft said.

“I believe that the EU market will progressively close to other commodities in a bid to support the growing of regenerative agriculture.”

By Giada Ferraglioni – giada@carbon-pulse.com

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