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As global demand for agricultural commodities grows, concerns over deforestation and environmental degradation have intensified. In the European Union (EU), discussions on “embodied deforestation” highlight the environmental impact of consumer demand. This concept refers to deforestation linked to the production of goods and commodities, particularly agricultural imports, which often remains an overlooked externality[1].
Among the key drivers of deforestation embedded in EU trade, oilseeds – especially soy – play a dominant role[2], followed by coffee and cocoa[3]. Brazil is a major source of these commodities, with a significant portion of the EU’s deforestation-linked imports originating from its agricultural sector[4]. Studies have shown that a substantial share of illegal deforestation worldwide is tied to European demand, particularly for soy-based products[5].
The environmental cost of these trade flows is considerable. The EU has historically imported large volumes of deforestation-linked soy, beef, leather, and palm oil, with Brazil and Indonesia being major contributors[6]. As concerns over sustainability grow, these figures underscore the urgent need for stronger regulatory frameworks and responsible sourcing practices to mitigate the EU’s global deforestation footprint.
To address these challenges and support climate action, the EU introduced Regulation EU 2023/1115 (EUDR)[7] under the European Green Deal[8]. This regulation bans the sale and export of key commodities – cattle, cocoa, coffee, palm oil, rubber, soy, and timber – if linked to deforestation or forest degradation. By prioritizing sustainable trade, the EU aims to reinforce its environmental diplomacy and align its policies with the goal of carbon neutrality by 2050.
Despite its ambitious aims, the EUDR’s implementation has faced delays and controversy. Effective since June 2023, its enforcement deadlines extend to December 2025 for large companies and June 2026 for smaller enterprises[9]. Additionally, the recent introduction of a “no-risk” category for countries with minimal deforestation sparked concerns over green protectionism, as some argue it disproportionately benefits EU-based producers. Despite this, the regulation is already influencing business decisions. Notably, the French food and beverage company Danone, initially announced it would suspend Brazilian soybean purchases due to sustainability concerns[10]. However, the company later clarified that it would continue sourcing soy under international standards[11], while the Brazilian government defended its national due diligence practices and compliance with global traceability norms[12].
The EUDR’s extraterritorial scope has also drawn criticism from Latin American governments, who argue that it constitutes a unilateral trade barrier. Several countries have challenged the regulation within the WTO’s Technical Barriers to Trade (TBT) Committee[13], arguing that a one-size-fits-all approach overlooks local realities, burdens small producers, and may not effectively reduce deforestation. Brazil, in particular, has advocated for differentiated compliance measures to support small-scale farmers in developing nations, mirroring the flexibility granted to small EU enterprises.
Amid these debates, the EUDR marks a significant shift in the EU’s transnational regulatory approach, highlighting its growing extraterritorial influence. While its intent is to shape global environmental governance, its broader implications for international trade, market access, and the balance between sustainability and economic equity remain subjects of ongoing discussion. Moving forward, the success of the regulation will depend on its ability to harmonize environmental commitments with fair trade practices, ensuring that sustainability efforts do not inadvertently create new economic disparities.
[1] Weatherley-Singh, J., & Gupta, A. (2018). “Embodied deforestation” as a new EU policy debate to tackle tropical forest loss: Assessing implications for REDD+ performance. Forests, 9(12), 751.
[2] According to the FAO, oilcake is the residue left after oil is extracted from an oilseed. The inedible oilcake can be used as fertilizer, and the edible oilcake is used primarily as livestock feed. See: FAO. (2006). Plant nutrition for food security (FAO Fertilizer and Plant Nutrition Bulletin No. 16, p. 12). http://www.fao.org/3/a-a0443e.pdf.
[3] According to the FAO, oilcake is the residue left after oil is extracted from an oilseed. The inedible oilcake can be used as fertilizer, and the edible oilcake is used primarily as livestock feed. See: FAO. (2006). Plant nutrition for food security (FAO Fertilizer and Plant Nutrition Bulletin No. 16, p. 12). http://www.fao.org/3/a-a0443e.pdf.
[4] FERN. (2015). Stolen goods: The EU’s complicity in tropical deforestation (p. 55). https://www.fern.org/fileadmin/uploads/fern/Documents/Stolen%20Goods_EN_0.pdf.
[5] FERN, Stolen goods.
[6] European Commission. (n.d.). The impact of EU consumption on deforestation: Comprehensive analysis of the impact of EU consumption on deforestation (p. 140).
[7] European Parliament and Council of the European Union. (2023). Regulation (EU) 2023/1115 of the European Parliament and of the Council of 31 May 2023 concerning the making available on the Union market and export from the Union of certain commodities and derived products linked to deforestation and forest degradation, and repealing Regulation (EU) No 995/2010. Official Journal of the European Union.
[8] European Commission. (2019). Communication COM(2019) 640 final from the Commission to the European Parliament, the European Council, the Council, the European Economic and Social Committee and the Committee of the Regions on the European Green Deal of 11 December 2019. Brussels.
[9] European Parliament and Council. (2010). Regulation (EU) No 995/2010 of the European Parliament and of the Council of 20 October 2010 laying down the obligations of operators who place timber and timber products on the market: Text with EEA relevance. Official Journal of the European Union. Art. 38.
[10] Reuters. (2024, October 25). France’s Danone cuts out Brazilian soy ahead of tough new EU rules. Reuters. https://www.reuters.com/business/retail-consumer/frances-danone-cuts-out-brazilian-soy-ahead-tough-new-eu-rules-2024-10-25/.
[11] Danone Brasil. (2024, October 30). Nota oficial da Danone Brasil sobre soja. Danone Brasil. https://corporate.danone.com.br/Nota-Oficial-da-Danone-Brasil-sobre-Soja.
[12] Secretaria de Comunicação Social. (2024, October 30). Official response to recent statements by European agrifood companies. Governo do Brasil. https://www.gov.br/secom/en/latest-news/2024/10/official-response-to-recent-statements-by-european-agrifood-companies.
[13] India; Indonesia; Australia; Mexico; New Zealand; Paraguay; United States; Canada and Colombia were the countries that raised concerns (STC 807) against the European Union with the TBT Committee, having received the support of Ecuador; Argentina; Guatemala; Indonesia; Australia; Mexico; New Zealand; Panama; Peru; Russian Federation; Singapore; Türkiye; Brazil and Costa Rica.
