Service contract on EU policy on forest products and deforestation : Task 3 - Impact assessment on demandside measures to address deforestation

Summary

Forests are being cut and degraded at an alarming rate, with the expansion of agricultural land as a main driver. The EU plays a significant role in global deforestation and forest degradation through the consumption of certain commodities. This report recommends the implementation of a mandatory due diligence system ensuring that commodities and derived products under scope and placed on the EU market do not come from supply chains associated with deforestation and forest degradation alongside a benchmarking mechanism to support the identification of levels of risk for specific countries and commodities. This report provides an EU-wide definition for ‘deforestation-free supply chains’, based on the one used by the FAO and the Accountability Framework Initiative, while capturing the needs of the EU intervention. The due diligence system would apply to some bulk commodities with significant consensus in the literature and among stakeholders (palm oil, beef, cocoa, coffee, soy, and wood), as well as products that contain the commodity as an ingredient and products requiring the commodity in their production. This report provides estimates of the costs and benefits of implementing the due diligence system and benchmarking.