EU Deforestation Law Delay Sparks Industry Concerns

The European Union's proposed 12-month delay of its anti-deforestation law has raised concerns among industry groups. Companies paid premiums for compliant agricultural goods, but now face financial losses. The law's postponement might exempt small-scale farmers from compliance, affecting cocoa, soy, and oil palm imports.

The European Union's decision to potentially delay its anti-deforestation law by a year is causing concern among industry groups and traders. Many companies, having already invested in compliant agricultural products, face financial losses should the legislation's implementation be postponed.

The EU Deforestation Regulation aims to ban the import of deforestation-linked commodities such as cocoa, coffee, and soy. Initially set to start on December 30, the proposal to delay comes amid fears of supply chain disruptions and increased costs for essentials if enforced prematurely.

Organizations like Fediol and Fefac have warned that firms, particularly in cocoa and animal feed industries, might find difficulty recouping premiums paid. However, while some welcome the delay for its potential to ease burdens on small-scale farmers, others remain critical of the regulation's complexity.

(With inputs from agencies.)