What are the top drivers of deforestation and how can EUDR help?
The London School of Economics and Political Science reported the annual rate of deforestation as some 10 million hectares per year between 2015 and 2020, and according to KPMG, imports to the EU are one of the biggest drivers of global deforestation.
So, what are the top drivers of deforestation and how can the Regulation limit their impact?
The United Nations Environment Programme lists agricultural expansion as one of the top drivers of deforestation, forest degradation and biodiversity loss, while the Union of Concerned Scientists of USA agrees, going into more detail to list large-scale soybean production, pasture expansion for cattle production, palm oil plantations and logging as specific activities.
A summary from the European Commission also lists coffee and cocoa as top deforestation drivers in the European Union.
The EUDR lists seven specific commodities and their derivatives as most harmful in a deforestation context, and six of the seven above are on that list. The seventh is rubber; forested areas are often cleared to make room for growing rubber trees says the WWF, and the same is true of most of the commodities listed here.
Under EUDR, companies across the supply chain will need to confirm that they meet EU regulations before any products or their derivatives are placed on the EU market. This means providing certain geolocation and traceability records to Regulation Member State authorities for vetting, as well as sharing the satellite monitoring tools and field audit techniques used along the production journey to ensure compliance to ‘deforestation-free’. Benchmarks will also be put in place by the European Commission to better gauge deforestation risk across these top drivers as well as per country.
Companies across the supply chain have until 30 December 2024 to comply with key articles within the Regulation. From this date, it will be prohibited to place commodities and derived products on the EU market or export them from the EU unless the following criteria are met says global law firm White & Case:
- commodities and products are classified as deforestation-free;
- they were produced in accordance with the relevant legislation of the country of production; and
- they are covered by a due diligence statement indicating no more than a negligible risk of non-compliance; in other words, the risk of non-compliance is small.
Small businesses and micro enterprises have until 30 June 2025 to comply to EUDR.
Sustainable forest management is crucial in preserving both the biodiversity and productivity potential of forests. Regulations such as EUDR are driving real change on the journey towards greater environmental, social and economic sustainability.