Key Takeaways:
- The EUDR requires companies placing certain commodities on the EU market to prove their products are deforestation-free, with geolocation data as the core evidence
- Seven commodity groups are covered: cattle, cocoa, coffee, oil palm, rubber, soya, and wood
- Compliance depends on geospatial due diligence: mapping production sites, verifying land use changes via satellite imagery, and documenting risk assessments
- Penalties for non-compliance include fines proportional to annual turnover, product confiscation, and market access bans
- Building the right geospatial workflows now reduces both compliance risk and the cost of ongoing monitoring
What the EUDR Is
The European Union Deforestation Regulation (EUDR) entered into force on 29 June 2023. It requires that products consumed or exported within the EU do not contribute to deforestation or forest degradation. Operators and traders had 18 months from that date to implement the new requirements.
The regulation is part of the EU's broader commitment to reducing deforestation, first outlined in 2019 and reinforced through the European Green Deal. The United Kingdom is developing parallel legislation.
The goal is concrete: reduce carbon emissions from covered commodities by an estimated 32 million metric tonnes per year by cutting the link between EU consumption and global forest loss.
Why It Matters
Forests store carbon and support the ecosystems that keep agriculture, food chains, and weather patterns stable. When forests are cleared for commodity production, the carbon stored in trees and soil gets released as greenhouse gases. The resulting climate disruption (more frequent floods, fires, droughts) feeds back into the very agricultural systems that drove the clearing in the first place.
These effects carry real financial costs. Supply chain disruptions from climate-driven disasters push up commodity prices. Biodiversity loss weakens natural pest and disease control. And once a forest is cleared, reforestation takes decades or centuries to restore its original carbon capacity and biodiversity.
Prevention is more effective than restoration, which is why the EUDR exists, not just as regulation, but as a tool for reducing long-term business risk.
Who's Affected
Any person or company that places relevant products on the EU market or exports them, regardless of quantity or value, qualifies as an "operator" under the EUDR. This includes companies that transform one covered commodity into another.
The seven covered commodity groups:
- Cattle
- Cocoa
- Coffee
- Oil palm
- Rubber
- Soya
- Wood
Each category includes specific derived products detailed in Annex I of the regulation. Products not listed are not covered. Some exceptions apply. For example, packaging that is not sold as a standalone product.
Due diligence requirements differ slightly for SMEs versus larger operators, but the core obligation is the same: collect information about the product's origin, including the geolocation of the exact plots of land where it was produced, and prove that no deforestation occurred after 31 December 2020.
What Compliance Requires
Data Collection
Operators must gather detailed information for each relevant product:
- Product description, commodity code, and quantity
- Country of origin
- Supplier and producer details
- Evidence of legal harvest under the origin country's laws
- Geolocation coordinates of the production site(s), delineated as polygons (typically in GeoJSON format)
Risk Assessment
Based on collected data, operators must evaluate the risk of non-compliance. Factors include the presence of forests near production sites, regional deforestation rates, and the country's track record on enforcement.
If the assessment reveals any risk above negligible, operators must document and implement mitigation measures before placing the product on the market.
Documentation and Reporting
All findings must be submitted as a "due diligence statement" through the EUDR's information system (currently under development as of mid-2024). Documentation must be retained for five years.
Penalties
Non-compliance can result in fines calculated as a percentage of the operator's annual EU-wide turnover, confiscation of products and associated revenue, and temporary exclusion from public procurement and market access.
How Remote Sensing Supports Compliance
Geospatial data is not optional under the EUDR; it is the foundation of the entire due diligence process. Remote sensing provides the tools to collect and verify that data.
Verifying Production Site Locations
Satellite and drone imagery help operators confirm the location and boundaries of production plots. This is especially important when geolocation data comes from third-party producers and needs independent verification.
Initiatives like Overture Maps are making high-quality open geospatial data more accessible for these verification workflows.
Detecting Land Use Changes
The EUDR sets 31 December 2020 as the baseline date. No deforestation or forest degradation should have occurred after that date on land associated with covered products.
Multiple types of remote sensing imagery contribute to this assessment:
- Optical imagery distinguishes land use types by colour and vegetation indices
- Synthetic-aperture radar (SAR) provides weather-independent data on vegetation density and thickness
- LiDAR measures vegetation canopy height
By comparing imagery from the baseline date to the production date, operators can verify whether forest cover changed. The EU Observatory provides a global 2020 forest cover map and annual change maps, though these are supplementary tools; they are not legally binding evidence on their own.
Scaling the Analysis
The challenge is scale. A single operator may need to verify hundreds of production plots across multiple countries, each with different vegetation patterns, climates, and seasonal variations. Machine learning models improve both the speed and accuracy of these assessments, including species identification in ambiguous cases.
These same analytical capabilities (pattern detection across large geospatial datasets) are what power modern consumer analytics for retail, where location data informs decisions about where to invest and how to measure impact.
Due Diligence Workflow
A practical due diligence process follows four steps:
1. Assess Your Supply Chain
- Determine whether your products fall under Annex I of the EUDR
- Identify the original producers of covered commodities, including intermediate transformations
- Collect product data, supplier information, evidence of legal harvest, and geolocation coordinates
2. Map and Verify Production Sites
- Plot producer locations using geolocation data
- Verify accuracy against satellite or drone imagery
- Use a geographic information system to manage and cross-reference spatial data
3. Analyse Risk and Mitigate
- Compare remote sensing imagery from the baseline date (31 December 2020) to the production period
- Assess deforestation risk based on land use changes, regional deforestation rates, and country-level compliance history
- Document and implement mitigation measures where risk is identified
- Submit due diligence statements through the EUDR information system
- Retain all documentation for five years
4. Monitor Continuously
Products are rarely one-off transactions. Ongoing monitoring and data collection are necessary to maintain compliance across supply chain changes and new production cycles.
Conceptual workflow towards EUDR compliance
Getting Started
Building the geospatial tools and workflows for EUDR compliance is a significant undertaking, particularly for companies without in-house remote sensing expertise. Many operators find that partnering with a specialist is more reliable and cost-efficient than building capabilities from scratch.
Mapular provides geolocation verification, remote sensing analysis, and risk assessment services for companies navigating EUDR compliance. If you want to discuss how this applies to your supply chain, get in touch.
Frequently Asked Questions
What is the EUDR and why was it introduced?
The EU Deforestation Regulation requires that products consumed or exported within the EU do not contribute to deforestation, greenhouse gas emissions, or biodiversity loss. It was introduced as part of the EU's commitment to reducing the environmental impact of European consumption on global forests.
Which companies need to comply?
Any person or company that places covered products on the EU market or exports them, regardless of quantity or value. This includes companies that transform one covered commodity into another.
How do companies prove their products are deforestation-free?
By collecting and maintaining geolocation data for every production plot, verifying through remote sensing that no deforestation occurred after 31 December 2020, performing risk assessments, and submitting due diligence statements through the EUDR's information system.
What are the penalties for non-compliance?
Fines proportional to the environmental damage and product value, confiscation of products and revenues, and temporary bans from public procurement and market access.
What data must companies collect?
Product descriptions, quantities, production country, geolocation of production plots (as polygon coordinates), supplier and buyer details, and evidence that products are deforestation-free and comply with local laws.
What role does technology play in compliance?
Remote sensing (satellite, drone, SAR, LiDAR) is essential for verifying production site locations and detecting land use changes. Geographic information systems manage the spatial data. Machine learning improves analysis speed and accuracy at scale. For most companies, partnering with an experienced geospatial services provider is the most efficient path to compliance.
Resources and References
Official Documentation
- Legal text of the EUDR
- European Commission's support site on EUDR
- Due Diligence Registry and Information System
Sources on Carbon Stock and Biodiversity
- Baker, J. C. A., Lang, P. L., Richards, K. R., Webb, A. A., Mills, R. J., Krishnamoorthy, L., & Pendleton, L. (2022). Deforestation-induced climate change reduces carbon storage in remaining tropical forests. Nature Communications, 13, 2916. https://doi.org/10.1038/s41467-022-29601-0
- Chazdon, R. L. (2008). Beyond deforestation: Restoring forests and ecosystem services on degraded lands. Science, 320(5882), 1458–1460. https://doi.org/10.1126/science.1155365
- Goldstein, A., Turner, W. R., Spawn, S. A., et al. (2020). Protecting irrecoverable carbon in Earth's ecosystems. Nature Climate Change, 10, 287–295. https://doi.org/10.1038/s41558-020-0738-8
- Palviainen, M., Laurén, A., Pumpanen, J., Bergeron, Y., Bond-Lamberty, B., Larjavaara, M., et al. (2020). Decadal-scale recovery of carbon stocks after wildfires throughout the boreal forests. Global Biogeochemical Cycles, 34, e2020GB006612. https://doi.org/10.1029/2020GB006612
- FAO. (2019). The state of the world's biodiversity for food and agriculture. Food and Agriculture Organization of the United Nations. https://www.fao.org/state-of-biodiversity-for-food-agriculture/en/
- Ortiz, A. M. D., Outhwaite, C. L., Dalin, C., & Newbold, T. (2021). A review of the interactions between biodiversity, agriculture, climate change, and international trade: Research and policy priorities. One Earth, 4(1), 88–101. https://doi.org/10.1016/j.oneear.2020.12.008
