Responsible Sourcing-Council of the EU negotiating mandate on the EUDR

The regulation on deforestation free products came into force in January 2023 with the intent of ensuring that the sourcing of products such as beef, cocoa, coffee, palm oil, rubber, soya or wood and their derivatives sold or exported from the EU had been produced in a manner that had not caused deforestation or forest degradation. The implementation has been delayed for several reasons and this week the council adopted its negotiating mandate on a targeted revision on the EU regulation of de-forestation-free products (EUDR).

Under the Provision: –

• The requirements would take effect from 30 December 2026 for large and medium operators, and 30 June 2027 for small and micro-operators
• The obligations and reporting requirements will sit with the operators who initially or first placed the product on the market
• The downstream supply chain (operators or traders) would no longer e required to maintain and submit their own DD statements
• Small and Micro operators will only be required to submit a simplified declaration as a one-off process

An impact and burden assessment has been requested by the end of April 2026, and a final agreement on the standards is expected in the coming weeks.

Considering this announcement our Head of ESG, Sarah Blanchard looks at what this means in our latest blog

Business

• Companies who have been working hard to implement EUDR are frustrated with the postponements and the simplifications. Nevertheless, a European food sustainability leader said that their company would continue implementing the requirements and be ready for 30 December.

However, some organisations are pausing their implementation to see what they will need to change should the EU Parliament vote to approve the Council’s mandate. I see this as taking a breath but not stopping.

With the sustainability agenda growing in importance for consumers, companies who are ready should use the data gathered through EUDR as a competitive advantage and win over their customers (consumers and B2B) who care about transparency and deforestation.

“I don’t see many companies truly understanding the impact of deforestation on their ability to secure goods in future. I’m convinced that once they see the benefit of full transparency and traceability on their sourcing capabilities, we’ll see a change in attitudes”. Increased customer loyalty and the ability to talk confidently about their supply chains to investors will put in them in a better position to sustain their business long term. This is what EUDR should aim to support.

Council proposal

The negotiating mandate wants to simplify the submission of due diligence statements to the first who places the commodity on the market and having a one-off declaration for SMEs sounds sensible.

• Yet ensuring the declaration identifier travels with the product and remains up to date is something that needs clarifying.

The council also advocates for a similar traceability and reporting system to the one used by primary producers of cattle (Regulation (EU) 2016/429) and where buyers can access the national databases, lessening the burden on producers to deliver records.

• This is an interesting perspective and may be one that deserves a closer look.

The Council also wants a “simplification review” of the administrative burden by 30 April 2026.

• This feels and extremely tight timeline to engage thoroughly with industry with realities in businesses particular food companies, who are stretched and under resourced at the best of times. The regulation which will only have been enforced for four months and then it will be reviewed – that seems like an unnecessary administrative burden.

Mercosur and EUDR

A Procurement leader told me to watch the impact of the Mercosur agreement on EUDR – the EU Council has promised to protect EU farmers and ensure that the same traceability and safety requirements are applied to Mercosur imports.

• But one of the agreement’s goals is to reduce non-tariff barriers so supporters of EUDR need to hold tight.
• While the quotas are small now, they may increase in future and for this reason it’s even more important for companies to have robust digital tracing systems that can support due diligence and communication to customers.

How the additional load will impact the EUDR system isn’t clear yet, but buyers will need confidence in the EUDR system to enable them to do the requisite due diligence on their suppliers in risk countries.

It’s a hugely sensitive topic especially in France, and retailers and foodservice operators are constantly pressured by consumer and farmer groups for transparency – EUDR could help them prove the origin of their products which will either reassure or disappoint customers.

What to do

• Retailer Own Brands and brand owners could continue implementation and use supplier and product linked traceability and transparency platforms to ensure compliance as part of their regular due diligence.
• Take inspiration and use where relevant, organisations like Tony’s Open Chain for cocoa, commit at least to Fairtrade labelled products, and work with ITC who helps SMEs in poor countries to transition to deforestation free supply chains.
• Be prepared to add batch-based traceability as this will undoubtedly be needed in future across many more commodities – not just for EUDR but other elements such as carbon footprint and food safety. See EUDR compliance as a test of your traceability systems and review it as part of a broader strategy towards full transparency.
• Get serious too, about transitioning to 2D QR codes which will be an enabler for batch-based traceability. Embracing this type of technology to drive supply chain visibility and support compliance

Global attention on deforestation and COP

Eyes are on deforestation with COP negotiations in Brazil and the announcement of a Tropical Forest Forever Facility (a fund to support conservation and sustainable use of tropical forests). The EU Council President himself spoke about deforestation as a global challenge that needs global collaboration – so he should use the new EUDR negotiation as a moment to show leadership and do what he can to support the successful implementation of EUDR – so that it supports producers especially in countries at high risk of deforestation.

In the same spirit, where Brazil’s President Luna da Silva advocates for rich countries to support poor countries, multinationals must invest in their supply chains and support their commodity producers with a fair price and technical support. Knowing where and from whom you source is crucial to providing full traceability and transparency.

Concluding

The demand for transparency won’t go away and while EUDR might be simplified and delayed for some (hopefully not watered down), those who truly understand the implications of deforestation on their ability to source and supply goods will continue full steam with implementing the requirements.

As President Lula da Silva says “…know that maintaining the forest can yield more than destroying it”.

In other words, when the forests are healthy so are your cocoa, coffee, cattle yield as examples.

Prof Consulting Group

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