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Quick summary: Learn how to build deforestation-free supply chains for EUDR compliance using geolocation mapping, satellite validation, and digital Due Diligence Statements. Ensure traceability, reduce compliance risk, and maintain EU market access.
To build deforestation-free supply chains for EUDR compliance, companies must geolocate all production plots, validate that no forest was cleared after December 31, 2020, and ensure legal land tenure. GeoJSON files (points or polygons) must meet EU integrity standards and be cross-referenced with satellite data (e.g., Hansen GFC, Sentinel-2) to assess forest loss. A Due Diligence Statement (DDS) must accompany each product batch. Risk must be “not negligible,” with mitigation steps for high-risk plots. Documentation must be retained for 5 years. [Source: European Commission, Regulation (EU) 2023/1115, Article 9].
According to Nature, the global food demand is projected to increase by 30-62% by 2050.
The EU Deforestation Regulation (EUDR), officially Regulation (EU) 2023/1115, mandates that commodities like coffee, cocoa, palm oil, soy, rubber, wood, and cattle entering or leaving the EU must be proven deforestation-free and legally sourced. This regulation shifts compliance from voluntary sustainability to mandatory due diligence—placing a heavy burden on producers, exporters, and traders to ensure plot-level traceability and legality.
The stakes are high: non-compliance can result in rejected shipments, market bans, reputational damage, and significant financial penalties. But for companies that get ahead, EUDR presents a unique opportunity. By embedding end-to-end traceability into sourcing operations, businesses not only meet legal requirements—they gain a competitive edge in increasingly conscious global markets.
Today, traceability isn’t just about transparency. It’s about access. Building deforestation-free supply chains through verified geolocation, real-time data validation, and digitally auditable systems is now essential for maintaining market share, winning over eco-conscious buyers, and future-proofing agri-commodity exports into the EU.
Key takeaways
Under the EU Deforestation Regulation (EUDR), “deforestation-free” means that the commodity or product was produced on land not subject to deforestation after December 31, 2020. This includes direct forest clearing or conversion of natural forests to agricultural use, even if induced by natural events followed by planting activities.
Explore our expert blogs on the leading causes of deforestation and step-by-step guides to achieving full EUDR compliance for your supply chain.
Read: What’s Driving Global Deforestation?
Explore: The Complete EUDR Compliance Guide for Exporters & Producers
Globalization, population growth, food loss and waste, dietary shifts among consumers are few of the factors that push for variety in agriculture production. The land degradation and climate change is reducing the available arable land. In the ‘business as usual scenario, this will lead to conversion of forest lands into agriculture that will have a huge impact on climate and biodiversity.
Palm oil, Soy, Cocoa, Rubber, Beef, timber and coffee are the major agriculture commodities that drive deforestation and ecosystem conversion. These are largely produced in tropical countries like Brazil and Indonesia where largest tracts of forests are at risk. Some of these products are direct drivers of deforestation. A forest can be cut down and sown with grass to create pasture for the cattle. The forest can be cut down to plant palm trees. A large proportion of forests are also cut down to grow cocoa and soy. Deforestation drivers can also be indirect, where forest land is gradually degraded by shifting cultivation and timber extraction and replacing by cash crops.
Timber harvesting, Cattle ranching and soy production have different deforestation profiles. Cattle ranching and soy farming accounts for 80% of deforestation in Amazon. 80% of soy is used to feed animals to produce beef and other dairy products.
Beef Deforestation releases 340 million tons of carbon into the atmosphere, most of it coming from the Amazon region.
Palm oil is a key ingredient that is found in almost every product in a supermarket store. Right from the soaps, shampoos to cookies and snacks have palm oil as one of its ingredients. This palm oil is extracted from the fruits grown on palm trees. The growing demand has resulted in palm oil deforestation with a significant destruction of rainforests in Indonesia. The forests are slashed and burnt to pave way for palm plantations. This has not only caused biodiversity losses but also has displaced a number of indigenous communities from their lands.
Timber production is another major driver of deforestation due to illegal logging. Many types of wood used for furniture, flooring and construction are harvested from tropical forests in Africa, south America and Asia. Large trees are cut down and dragged through the forests.
The four forest-risk commodities are found in many value chains across a number of sectors and an average company generates almost 24% of revenue from them.
According to CDP reports, some companies report that they are still unaware of the presence of these forest commodities and their impact. Forests are cleared at alarming rates to grow palm and soy and provide grazing land for livestock. Agriculture is the clear cause of deforestation to produce these commodities with large scale commercial agriculture accounting for 40% of deforestation and local subsistence farming accounting for 33 % of deforestation.
Food producers are the largest source of deforestation on the planet accounting for between 60% and 80% of biodiversity loss.
Concealed within the everyday food products we purchase, including items like chocolate and ice cream, lie commodities such as palm oil and soy. These commodities, extensively used in various industries, are linked to deforestation on a global scale. From Indonesia to the Peruvian Amazon, vast expanses of carbon-rich forests are being systematically cleared to make way for the production of these agricultural commodities. This widespread deforestation not only fuels climate change but also triggers social conflicts in affected regions.
In the food and beverage sector, deforestation is due to meat, soy and palm oil. Meat production is a major driver for deforestation with vast areas of land being cleared for grazing livestock and growing soya for the animal feed. The animal products that we consume like the meat, egg and dairy all contribute to deforestation. Soyabeans are also used as vegetable oil, as an emulsifying agent in food products and other soya products. Palm oil is a widely consumed oil in our planet with many of the delicacies like chocolates, ice cream, cookies and pizza dough having them as an ingredient.
Did you know that a significant portion of the world’s cocoa, a key ingredient in our favourite chocolate treats, is linked to deforestation? Cocoa Deforestation not only threatens biodiversity but also impacts the livelihoods of cocoa farmers.
That morning cup of joe might be costing more than you think. Large-scale coffee production is a major driver of coffee deforestation, as traditional growing methods often clear swathes of rainforests to make way for coffee plantations.
Deforestation lurks beyond the label: It’s not just the food we eat.
Even the packaging surrounding our food contributes to deforestation. The pulp and paper used often come from timber sources, adding another layer of concern.
Southeast Asia, responsible for a staggering 90% of global natural rubber production, has witnessed rubber deforestation. The automobile industry, heavily reliant on rubber, also plays a significant role in this story.
The fashion industry takes its toll as well. Shockingly, over 150 million trees are cut down each year to produce cellulose fibers for clothing.
EUDR Perspective: Deforestation is the conversion of forest to agricultural use, whether it occurs due to human action or natural disturbances (e.g., wildfires, storms) if the land is subsequently used for agriculture.
Many assume natural loss isn’t “deforestation” under the law—but EUDR looks at land-use change, not just cause. This redefines liability, especially for farmers converting fire-damaged areas.
Remote sensing alone isn’t enough—you must pair it with land-use history and post-event monitoring to prove compliance.
EUDR Definition: Land >0.5 hectares with trees >5m in height and canopy cover >10%, or land capable of reaching these thresholds naturally.
Excludes: Land predominantly used for agriculture or urban purposes.
EUDR does not rely entirely on visual canopy cover. It includes potential forest regeneration, making it broader than FAO or Hansen maps.
Smallholders may misclassify degraded lands or sparse tree cover areas as “non-forest.” Pre-validation using EU thresholds is essential.
Includes cultivation of crops, livestock rearing, and set-aside lands.
This wide definition ensures that even temporary or multi-use lands fall under scrutiny—particularly agro-pastoral systems in Africa and Asia.
Land previously under shifting cultivation could be flagged unless clearly documented.
Tree-based agricultural systems like oil palm, fruit orchards, and agroforestry, excluding wood plantations.
Agroforestry is not exempt from deforestation checks. Its inclusion signals EUDR’s intent to regulate tree-covered agri-systems, not just clear-cutting.
Must differentiate agroforestry from plantation forests through documented crop-tree integration plans.
The conversion of primary/natural forests to plantation forests or other wooded land that alters ecological value.
Even if tree cover remains, changing forest type can trigger non-compliance. This is critical for replanting projects, selective logging, or mono-culture enrichment.
Use change-detection algorithms to distinguish structural degradation vs. natural succession.
Naturally regenerated forest with native species, no visible signs of human activity, and undisturbed ecological processes.
These forests are high conservation value (HCV) areas. Any conversion, even partial, is high-risk under EUDR.
Maintain exclusion buffers around primary forest edges when digitizing farm plots.
Forests growing mostly via natural processes but may include planted trees.
This classification is often misunderstood in reforestation and agroforestry contexts.
Supply chain actors must provide evidence of regeneration source—e.g., satellite history or field notes.
Forests established through planting/seeding where planted trees make up >50% of growing stock.
Often associated with industrial forestry. These may still fall under deforestation scrutiny if they replaced natural ecosystems.
Combine vintage land-use maps with current tree-age analysis to validate origin.
Highly managed planted forest with 1–2 species, even-aged, regular spacing, mostly for wood/fiber.
Excludes: Forests planted for restoration or mimicking natural forests.
Uniformity in structure can be a compliance red flag.
Forest type classification must be accurate in risk-scoring models.
Products must originate from land not deforested after Dec 31, 2020.
Includes: Prevention of forest degradation for wood-based commodities.
“Deforestation-free” isn’t only about land conversion—it’s a timestamped condition with spatial, legal, and chronological evidence.
Tools must archive geolocation and satellite validation with timestamped proof of no conversion.
The EU’s nuanced forest classification framework makes binary compliance models ineffective. Traceability and risk assessment tools must:
Failure to do so risks over-flagging (rejecting compliant plots) or under-reporting (letting deforested plots through).
Digital technologies are essential in meeting EUDR’s strict traceability, legality, and deforestation-free sourcing requirements. Here’s how they contribute:
Technologies like GPS-enabled mobile apps and GIS platforms capture farm-level geolocation data (points or polygons), ensuring that sourcing areas are precisely mapped and verifiable against post-2020 deforestation baselines.
Remote sensing datasets such as Hansen Global Forest Change, Sentinel-2, and PlanetScope are used to detect forest loss, canopy cover, and land-use change in real time. These tools help operators assess whether a plot was deforested after the cut-off date.
Cloud-based systems enable secure storage and validation of legal documents, including land titles, permits, and sustainability certifications. Automated flagging helps identify expired or missing paperwork critical for DDS submission.
Platforms auto-generate Due Diligence Statements (DDS) by integrating traceability, legal, and risk data into a compliant EU TRACES-ready format.
Blockchain, audit trails, and real-time dashboards maintain defensible compliance records and support inspections by EU authorities.
Result: Digital tools not only reduce human error and paperwork but accelerate risk assessment, enhance transparency, and protect market access under EUDR.
The TraceX EUDR Compliance Platform empowers businesses to build verifiable, deforestation-free supply chains by unifying geolocation, documentation, risk assessment, and DDS generation in one integrated digital ecosystem.
Plot-Level Traceability
TraceX enables mobile-based, offline-ready mapping of farm plots using points or polygons. It validates geolocation data against EU geometry rules, ensuring alignment with the 2020 deforestation cut-off.
Automated Deforestation Risk Checks
The platform integrates satellite data (e.g., Hansen, Sentinel-2) to automatically detect forest loss or proximity to protected areas. Each plot is scored for deforestation and legal risk.
Supplier Onboarding & Document Collection
With multilingual forms and digital KYC, TraceX streamlines onboarding of producers. It links land titles, certifications, and transport records to each harvest batch—flagging any compliance gaps.
DDS Auto-Generation & TRACES Integration
TraceX compiles all traceability, geolocation, and risk metadata into a fully formatted Due Diligence Statement (DDS) for seamless upload to the EU TRACES portal.
Audit-Ready Compliance Logs
All actions—mapping, scoring, document uploads—are time-stamped and recorded, creating an auditable, defensible compliance trail.
Regulatory Updates & Alerts
The system tracks changes in EUDR rules and instantly updates templates and workflows—ensuring exporters stay compliant as policies evolve.
We need to drive a better alignment between technology and the environmental goals. Deforestation is the third largest source of greenhouse gas emissions generating 15 to 20 % of the carbon emissions and it is essential for companies to disclose the impact of forest and ecosystems to achieve the climate and nature targets. The disclosure of Scope 3 emissions, investor pressures to manage deforestation risk and due diligence due to regulatory requirements will mandate the need for traceability in these supply chains and result in deforestation free supply chains.
Discover how to streamline compliance with expert blogs on EUDR due diligence, sustainable sourcing strategies, and the latest technology solutions built for EUDR.
Read: EUDR Due Diligence Explained – What Every Exporter Must Know
Explore: How to Build a Sustainable Sourcing Strategy for EUDR
Learn: Digital Tools Powering EUDR Compliance Across Supply Chains
Start building traceable, compliant, and future-ready operations today.
Under EUDR, ‘deforestation-free’ means that the commodity was produced on land that has not been subject to deforestation after December 31, 2020. This includes any conversion of forest to agricultural use, regardless of cause.
You must provide geolocation data (point or polygon in GeoJSON format), legal land ownership documents, and satellite-verified deforestation risk assessments to support each Due Diligence Statement (DDS).
Digital platforms help automate farm mapping, risk scoring, document collection, and DDS generation—ensuring traceable, audit-ready supply chains that meet EUDR standards.
