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Quick summary: EUDR is reshaping India’s palm oil sector—Is your business ready? Learn how importers, processors & exporters can ensure traceability, due diligence & compliance to retain EU market access.
Is your palm oil business ready for the EU’s toughest trade regulation yet? As the EU Deforestation Regulation (EUDR) is set to transform global palm oil trade, EUDR’s Impact on India’s Palm Oil Sector cannot be ignored. As one of the world’s largest importers and processors of palm oil, India’s supply chain is now under intense scrutiny. Without full traceability and compliance, businesses risk losing access to the lucrative EU market.
Many Indian palm oil importers and processors lack verifiable proof that their raw materials are deforestation-free—a critical EUDR requirement. With over 9 million metric tons of palm oil imported annually, ensuring that every batch meets EUDR’s strict geolocation and due diligence standards is a massive challenge. Failure to comply could mean shipment rejections, penalties, and lost revenue. Businesses must act fast by implementing traceability technology, supplier risk assessments, and sustainable sourcing certifications to stay compliant. This blog will break down EUDR’s impact on India’s palm oil sector, what it means for importers and processors, and how companies can future-proof their supply chains for EU trade success.
Key Takeaways
Palm oil represents a critical commodity in global trade, accounting for 35% of the world’s vegetable oil production. While Indonesia and Malaysia dominate global production with 85% of the world’s palm oil output, India’s role in the palm oil supply chain is primarily as an importer and processor rather than a major producer. The EUDR’s impact on India’s palm oil sector is therefore more concentrated on companies that import, process, and re-export palm oil products to the EU.
For these Indian businesses, ensuring the traceability and sustainability of palm oil sources is becoming imperative. The regulation requires comprehensive documentation that the palm oil was not produced on land subject to deforestation after December 31, 2020. This has sparked a growing interest in sustainable sourcing practices and certification mechanisms among Indian palm oil processors who serve European markets.
Under EUDR, the EU is saying, “We don’t want palm oil linked to deforestation.” That means businesses trading with Europe must prove their palm oil comes from sustainable, legal sources. Here’s how:
The EU now requires geolocation data for every batch of palm oil. Why? Because they want to ensure it wasn’t sourced from deforested land after December 31, 2020.
Example: If an Indian importer buys crude palm oil (CPO) from an Indonesian supplier, they must ensure the supplier provides GPS coordinates of the plantation. If the land was cleared illegally, the entire batch is non-compliant—and you can’t sell it in the EU.
If your supplier can’t provide precise location data, you risk losing EU buyers.
Before you can export palm oil products to Europe, you need to submit a Due Diligence Statement (DDS). This is basically proof that your palm oil meets EUDR standards.
Example: Let’s say a palm oil processor in India refines CPO into cooking oil. Before selling it to an EU-based food company, they must submit a DDS to the EU Information System—stating that the oil is deforestation-free, legally sourced, and meets sustainability requirements.
No DDS = No EU market access. Get your paperwork in order.
EU buyers want a clear, tamper-proof supply chain. That’s where blockchain and digital traceability come in.
Example: Imagine an FMCG brand in India that exports palm oil-based shampoo to France. If the buyer asks, “Where exactly did this palm oil come from?”, the Indian exporter must provide a digital record tracing it back to a certified plantation.
Invest in digital traceability solutions—because Excel sheets won’t cut it anymore.
If you import palm oil from Indonesia, Malaysia, or elsewhere, your responsibility starts before the oil even reaches India.
Example: If an Indian importer buys from a supplier in Malaysia that can’t provide verifiable sourcing data, the shipment may be rejected by EU buyers.
Indian companies that refine crude palm oil (CPO) into cooking oil, margarine, or personal care products must maintain detailed supplier records.
Example: If an Indian refinery sells palm oil to Nestlé in Europe, they must provide digital proof of compliance. No compliance? No contract.
If you process palm oil in India and export to the EU, the rules are even stricter.
Example: A company in Mumbai exporting palm oil-based cosmetics must prove every ingredient meets EUDR requirements—or risk being removed from the EU supply chain.
India imports ~9 million metric tons of palm oil annually.
The EU Deforestation Regulation (EUDR) has sent shockwaves through global palm oil supply chains—including India’s. As one of the largest importers, processors, and re-exporters of palm oil, India’s businesses must now rethink sourcing strategies, supplier transparency, and digital traceability to stay competitive in the EU market.
But here’s the challenge: Most suppliers don’t have the systems in place to prove compliance. And without this, Indian palm oil businesses risk shipment rejections, contract losses, and regulatory penalties.
So, what’s standing in the way? And more importantly, how will India’s palm oil sector evolve to meet these new demands? Let’s break it down.
One of the biggest compliance hurdles is proving exactly where the palm oil was grown. Under EUDR, every shipment must have geolocation data showing that it wasn’t sourced from deforested land after December 31, 2020.
Many palm oil producers in Indonesia & Malaysia—where most of India’s imports come from—don’t maintain proper GPS-based farm records. This makes it extremely difficult for Indian businesses to prove compliance when exporting refined palm oil or palm-based products to Europe.
If an Indian palm oil refinery buys crude palm oil (CPO) from an Indonesian supplier but can’t verify the farm’s location, that entire batch may be blocked from entering the EU. No geolocation proof = no EU market access.
Ensuring EUDR compliance means getting certified, conducting audits, and maintaining digital records. But for small and mid-sized processors, these costs can add up quickly.
While large refiners can absorb certification costs, smaller players face financial pressure to implement:
A mid-sized palm oil processor in Mumbai that exports to the EU will now need to pay for supply chain verification, hire compliance officers, and upgrade traceability tech—or risk being dropped by EU buyers.
Let’s be real—ensuring every single supplier follows EUDR rules is a logistical nightmare. Many suppliers operate in high-risk areas, and some may falsify sustainability claims to continue selling palm oil.
Even if Indian importers and refiners trust their direct suppliers, sub-tier suppliers (farmers, cooperatives, or middlemen) might not be compliant.
A palm oil buyer in India might purchase from an “EUDR-certified” supplier in Malaysia—only to find that some of the oil was mixed with non-compliant batches from deforested land.
The challenges are real, but so are the opportunities. India’s palm oil sector is evolving fast to align with the EUDR.
With EUDR banning deforestation-linked palm oil, EU buyers will ONLY purchase from certified sustainable sources like RSPO & ISCC-certified suppliers.
If you’re an Indian palm oil processor, switch to RSPO-certified suppliers now—or risk losing EU buyers to competitors who already have compliant sourcing.
To ensure transparency, businesses will integrate AI, blockchain, and IoT for:
Indian palm oil exporters will undergo tighter audits before shipments are cleared. More checks. More paperwork. More responsibility.
The demand for deforestation-free palm oil in the EU is expected to rise by 30% by 2026—but only for companies that can prove compliance.
The EU Deforestation Regulation (EUDR) is no longer a future challenge—it’s here, and it’s changing the way Indian palm oil businesses operate. If you’re an importer, processor, or exporter, you need to take immediate action to ensure compliance and avoid losing access to the EU market.
But let’s be honest: meeting EUDR standards isn’t easy. It requires deep supply chain visibility, advanced tracking technology, and stricter due diligence than ever before. The good news? With the right strategies, Indian palm oil businesses can adapt and thrive.
Here’s a step-by-step guide to staying compliant and securing your position in the EU palm oil trade.
The EU wants proof that palm oil wasn’t sourced from deforested land after December 31, 2020. Without GPS tracking, satellite mapping, and supplier verification, your shipments won’t clear customs.
What You Need to Do:
An Indian palm oil refinery sources crude palm oil (CPO) from multiple suppliers in Indonesia & Malaysia. Without GPS-tagged sourcing data, they can’t prove compliance, meaning EU buyers will reject their shipments. By adopting a traceability system, they ensure each shipment has geo-tagged proof of origin.
If your suppliers can’t provide location data, it’s time to find new ones.
The EU now favors suppliers with sustainability certifications like RSPO (Roundtable on Sustainable Palm Oil) & ISCC (International Sustainability & Carbon Certification). Without these, your palm oil may be seen as high-risk.
What You Need to Do:
A major FMCG brand in Europe refuses to buy non-certified palm oil. An Indian palm oil processor, who used to supply them, is forced to switch to RSPO-certified sources to retain the contract.
Certification isn’t just a compliance checkbox—it’s a competitive advantage.
Due diligence is now mandatory—but manually verifying every supplier is impossible at scale. AI-powered compliance tools can automate risk assessments and flag high-risk suppliers before they cause problems.
What You Need to Do:
An Indian palm oil company manually tracks compliance using spreadsheets. As the EUDR deadline approaches, they struggle to verify hundreds of suppliers. By integrating an AI-driven compliance platform, they automate risk detection, reducing verification time
AI can spot supply chain risks that humans might miss. Don’t wait for non-compliance to cost you your EU contracts.
The EU will conduct stricter audits on palm oil shipments. If your due diligence process isn’t airtight, your exports may be delayed—or worse, rejected.
What You Need to Do:
A palm oil exporter in India ships bulk palm oil to Germany. Upon arrival, EU authorities request detailed due diligence records. Because the exporter has blockchain-powered traceability, they provide a real-time audit trail, clearing customs without delays.
EU buyers will demand transparency. Get audit-ready before they start asking questions.
Palm oil businesses face increasing pressure to meet the EU Deforestation Regulation (EUDR) requirements, ensuring full traceability and sustainability in their supply chains. TraceX’s EUDR Compliance Platform simplifies compliance for importers, processors, and exporters by offering end-to-end digital traceability, automated due diligence, and risk assessment tools.
Geolocation & Farm-Level Traceability:
Automated Due Diligence & Compliance Reporting:
Blockchain-Powered Transparency & Risk Management:
Supplier Verification & Audit-Readiness:
The EU Deforestation Regulation (EUDR) is reshaping the global palm oil trade, and Indian businesses must act now to ensure compliance. With geolocation tracking, supplier verification, and automated due diligence, companies can secure EU market access and strengthen their sustainability commitments.
The way forward? Invest in traceability technology, partner with certified sustainable suppliers, and embrace AI-driven compliance solutions. Businesses that proactively adapt to EUDR regulations will gain a competitive edge, build trust with EU buyers, and future-proof their exports.
EUDR mandates geolocation tracking, due diligence statements (DDS), and proof of deforestation-free sourcing for all palm oil entering the EU.
By sourcing from RSPO/ISCC-certified suppliers, digitizing traceability, and using AI-driven risk assessment tools to flag non-compliant sources.
Non-compliance can result in shipment rejections, regulatory penalties, loss of EU buyers, and reputational damage in the global market.
