The EEA imports roughly €70 billion worth of products in scope of the EUDR* extra each year. How are those imports broken down, according to value? (Find key terms and a timeline at the bottom of the article.)
The top 7 EUDR commodities and their import value
1. Wood. This is by far the most representative commodity in terms of value: €10 billion per year, on average. Wood is exported from such faraway places as Indonesia, Brazil or Russia, and finds its way into the construction German and French industries, as well as Italian furniture design.
2. Palm Oil. This controversial commodity hails primarily from Indonesia and Malaysia, and is imported into the EEA to the tune of €8 Billion a year. The Netherlands is the main importer, since it is a major processing and distribution hub, followed by Italy and Spain.
3. Coffee. 7 billion euros worth of coffee enter the EEA every year, mostly from Brazil and Vietnam. As of 2023, Germany, France and Italy were the three largest importers.
4. Soy. Soybean annual imports into the EEA are valued at €6 billion, with the dominant suppliers being Brazil and the US. The agricultural sector, and more specifically, the animal feed subsector, absorb most of these imports, primarily in the Netherlands, Spain and Germany.
5. Cocoa. The annual value of cocoa imports is around €4-5 billion every year; the primary origin countries being Côte d'Ivoire and Ghana. The Netherlands, Germany and Belgium, with its renowned chocolaterie industry, are the top 3 destination countries.
6. Rubber. Thailand, Malaysia and Vietnam are the main suppliers of this important commodity into the EEA, with annual imports valued at €3 billion. It’s no surprise that the top 3 importer countries are those with a large industrial base in the automotive industry: Germany, France and Italy.
7. Cattle (Beef and Live Cattle). Around €2 Billion’s worth of beef is imported into the EEA each year, mostly from South America. Germany, the Netherlands and Italy are the top 3 destination countries.
How do EUDR imports affect Norway?
For Norwegian importers, the most significant commodities are Cocoa ($412.72 million), Coffee ($293.17 million) and Beef ($116 million, as of 2022). Norwegian imports of palm oil are relatively low, with substitute products being often used due to sustainability concerns.
Geographical red flags for EUDR compliance
The EUDR forbids sourcing from specific areas or countries subject to deforestation or forest degradation after December 31st, 2020. It also prohibits imports if the commodity did not comply with relevant local legislation or lacked a due diligence process to certify it as "deforestation-free."
Countries with higher EUDR compliance risks:
1. Brazil. Particularly the area of the Amazon Rainforest (which spans to Peru and Colombia as well), and the Cerrado region.
2. Indonesia. Of particular concern are the areas encompassing the tropical rainforest (which also includes Papua New Guinea).
3. Democratic Republic of Congo (DRC). The DRC includes the Central African Rainforest, an extremely valuable and diverse ecosystem.
4. Peru. High-risk rainforest areas
5. Colombia. Amazon and associated ecosystems
Are you wondering how far your supply chain stretches? Get in touch and see for yourself how easy it is to figure it out.
Key Terms: EUDR and Supply Chain
EUDR (EU Deforestation Regulation): A regulation aimed at preventing products linked to deforestation from entering the EU market. Companies must prove that commodities they import, like wood and soy, are "deforestation-free."
Due Diligence: A process where companies check their supply chains to ensure compliance with laws and regulations, such as avoiding products from areas affected by deforestation.
Commodity: A raw material or agricultural product that can be bought and sold, such as coffee, wood, or soy.
Supply Chain: The entire process of producing and delivering a product, from sourcing raw materials to delivering the final product to consumers.
Transparency: Making information about business practices and supply chain operations open and accessible, helping companies build trust and meet regulatory requirements.
Risk Assessment: Analyzing potential issues or challenges in a supply chain, like environmental harm or legal violations, to take preventive measures.
Timeline
29 June 2023: Regulation on deforestation-free products enters into force
30 December 2025: Regulation on deforestation-free products enters into application for large and medium companies
30 June 2026: Regulation on deforestation-free products enters into application for micro and small enterprises
Source: Environment.ec.europa.eu
