.png)
On October 24, the European Commission (EC) postponed the implementation of the EUDR to December 30, 2025, in response to pressure from various countries. The EUDR (European Union Deforestation Regulation) prohibits the distribution of products produced in deforested areas within the EU. It is an ambitious policy aimed at curbing deforestation. However, the regulation was proposed for delay by 20 European Union (EU) member states, as well as businesses and countries like Brazil and Indonesia, which raised concerns about the potential impact on trade, small farmers, and supply chains. The EC listened to these concerns and delayed implementation to give businesses worldwide time to adjust to the new compliance requirements.
However, the delayed implementation of the EUDR introduced something new: the inclusion of countries with sustainable forest management practices in the “no-risk” category. “No-risk” is a new category that did not exist in the original regulation. Certain countries in this category will be exempt from the strict requirements, allowing them to significantly reduce compliance checks. Furthermore, it was believed that the original intent of the regulation could be diluted, primarily due to the number of EU member states in the “no-risk” category, which sparked backlash from environmental groups and activists. Following the controversial date, EU negotiators attempted to reach a compromise on December 3, 2024, resulting in a decision to keep the existing regulation without major changes, but with a 12-month moratorium.
Previously, the EC delayed the EUDR to give companies and countries time to adapt to the regulation, prevent rapid disruption of existing supply chains, and help businesses—especially those in developing countries that rely on agricultural exports—adjust to the new requirements. In this spirit, it was agreed that large operators and traders will have until December 30, 2025, to comply with the regulation, while smaller companies will be given an additional six-month adjustment period. The EC has also promised to review whether the regulation can be simplified for countries with sustainable forest management practices.
Developing countries such as Brazil and Indonesia are concerned about the implementation of the EUDR. They argue that deforestation is often linked to agricultural expansion and the production of regulated commodities. In addition, governments in these countries argue that the EUDR could serve as a protectionist measure, excluding small farmers from access to the EU market, which is highly sensitive to global commodity prices. Brazil, in particular, has expressed concern that the regulation could affect its agriculture, as well as soy and beef exports. Indonesia emphasizes that the regulation is unfair to small farmers who produce palm oil.
Europe, on the other hand, is taking a different stance. The European People's Party, the largest parliamentary group, welcomed the compromise but called for more lenient rules, stating that sustainable practices in certain countries should be rewarded. Environmental groups, including the Greens, Europe's green party, have called the EUDR a 'partial but important victory,' arguing that while the delay is regrettable, it is an important step in preventing EU consumers from unknowingly contributing to the destruction of forests around the world.
While the EUDR remains a groundbreaking attempt to balance trade and climate, close monitoring and coordination will be essential in the immediate aftermath of its implementation. The agricultural community remains very vocal about its implementation, so the regulation will need to be revisited if any unforeseen issues arise after its implementation. Extending the timeline while maintaining the existing requirements provides a temporary reprieve for traders and farmers in developing countries, but it also signals that the European market will demand more sustainable practices in the future.
If implemented, the regulation will require developing countries to first adapt their supply chains to meet the EU's sustainability standards, which will increase compliance costs for producers. In addition to developing countries, the creation of a 'no-risk' category will benefit countries with strong sustainable forest management practices. However, those without such practices may face export restrictions. The possibility of retaliation cannot be ruled out, especially if trading partners in emerging markets believe the regulation could unfairly impact their economies.
Established to combat climate change, the EUDR was widely welcomed upon its introduction but now faces criticism from both developing countries and companies concerned about its economic consequences. Going forward, stakeholders in both developed and developing countries will need to work together to ensure that the regulation effectively reduces deforestation while treating small farmers and producers fairly. Although the 12-month moratorium provides time to prepare, changes in trade flows after its implementation will need to be closely monitored, with appropriate points of contact established for any countries or companies under pressure. For more insights into how the regulation will affect agriculture, check out EU approves EUDR delay and discards proposed change!
