Update on the European Union Deforestation Regulation: Concerns Over Delay Addressed

Prospects of postponing the European Union Deforestation Regulation (EUDR) for an additional 12 months seem unlikely, following recent remarks from EU officials in Luxembourg.

Commissioner Roswall’s Insights

In a recorded interview, Jessika Roswall, the Chair of the European Parliament Environment Committee, outlined expected changes to the EUDR legislation. Listen to the briefing here.

Proposal Revisions

The latest proposal, which seeks to avoid a delay to the EUDR schedule, comes on the heels of earlier suggestions that implementation might be postponed due to issues surrounding the regulation’s IT system.

Commissioner Roswall emphasized the EU’s commitment to the EUDR objectives, stating, “We remain very committed to that EUDR objective.”

Implementation Timeline

According to Roswall, the legislation is on track to be enforced starting on January 1, 2026. Here are some key points regarding the implementation:

• Large and Medium-Sized Companies: These entities must submit documentation from January 1, with a phased introduction over six months. During this phase-in period, EU country authorities can issue warnings but will not apply penalties until the end of this period on June 30.
• Micro and Small Companies: These businesses will be granted an additional year before needing to submit a Due Diligence Statement (DDS).
• Downstream Operators: They will not need to submit a separate DDS; instead, they can use the DDS Reference Number from the first operator.

No Room for a ‘Negligible Risk’ Category

During the briefing, Roswall indicated that introducing a ‘Negligible Risk’ category appears unlikely due to the extensive legislative work required and the limited time remaining before the regulations kick in.

Next Steps and Industry Response

The proposal will be reviewed by the EU Parliament and Council, potentially leading to changes. Meanwhile, stakeholders in Australia’s red meat industry recommend preparing for the original implementation date. Products currently in transit will need to be compliant with EUDR requirements.

As of September, fewer than half of Australia’s EUCAS-eligible livestock producers had signed up for the Integrity Systems Company’s EUDR Geolocation sharing tool, complicating compliance efforts ahead of the January deadline. Additionally, Australian cattle hides intended for EU markets also face EUDR scrutiny.

Market Implications

Producers voicing their lack of incentive to comply with EUDR forget that the EU represents the highest-paying market for Australian beef. As one trade source explained, “The option is, selling that product into another market at a cheaper price. That then gets reflected in livestock price – it’s the price of doing business.”

Furthermore, although the UK is no longer part of the EU, UK supermarket chains may require EUDR compliance for imports, aligning with the EU’s objectives.