Be proactive to adapt

08:25, 31/05/2023

The EU’s Deforestation and Degradation Free Supply Chain Regulation is expected to come into effect in June 2023. Accordingly, agricultural products can only be imported into the EU if the entire process does not take place in areas of deforestation after 2020.

Opportunities for transparent manufacturing

To address deforestation, which is a serious threat to global climate change, the EU has introduced the EU Deforestation Free Products (EUDR) Act, with clear requirements and targets for products associated with a high risk of deforestation and forest degradation, including coffee. The Act requires importers and their supply chain partners to demonstrate that their products are not associated with deforestation or forest degradation after December 31, 2020. Specifically, the EUDR requires that 100% of coffee products entering Europe must have GPS coordinates/polygons of each production farm. Based on monitoring tools, if deforestation/degradation is detected, the shipment will face recall and refund.

Farmers process coffee.

Currently, coffee is one of Vietnam's main agricultural export products, with nearly 1.8 million tons, bringing in a value of more than 4 billion USD by 2022. Dak Lak is the coffee capital of Vietnam with 213,336 hectares, an output of over 526,700 tons/year. Coffee is a key agricultural product in the economic structure of Dak Lak, accounting for a large proportion of the province's total social product and annual export turnover. However, the coffee industry faces many serious challenges from strict market requirements and sustainable pressures, especially in terms of deforestation, production emissions as well as sustainable and reasonable income for coffee farmers.

To meet the requirements of global development trends, since 2002, Dak Lak has implemented programs for sustainable coffee production with certification (4C, UTZ, RFA, FLO) and recently organic coffee. At the same time, 12 units have been certified to use the geographical indication "Buon Ma Thuot Coffee" for green coffee (total area of 20,326 hectares, registered output of 39,890 tons/year) and 7 units have been granted the right to use the geographical indication "Buon Ma Thuot Coffee" for roasted and ground coffee (193 tons of roasted coffee beans, 125 tons of ground coffee, 2,000 tons of pure instant coffee). This is also the first coffee geographical indication to be protected in Vietnam and internationally in 32 countries and territories. The implementation of programs and projects to develop sustainable coffee has contributed significantly to forming a new generation of coffee makers, in line with the global development trend of sustainable production.

Mr. Nguyen Hoai Duong, Director of the Department of Agriculture and Rural Development, assessed that this draft law aims to minimize the risks of products in the supply chain related to deforestation/degradation imported into or exported from the EU. Basically, EUDR does not have much impact on Vietnamese - Dak Lak coffee, because the EU takes the time frame from 2020 onwards, while Dak Lak coffee has been growing steadily for decades. At the same time, EUDR is also consistent with Vietnam's forest protection and coffee development policies. The province's viewpoint is to closely follow the contents of the draft law to ask for opinions from the Ministry of Agriculture and Rural Development to have a unified policy so that Dak Lak can be prepared for this, because these are issues that can affect Dak Lak's agricultural product exports to Europe. On this basis, Dak Lak will also review and re-evaluate the entire production status to prepare certificates for areas that are eligible to meet the new requirements of the EU, so that when the EUDR comes into effect, Dak Lak will be ready in terms of procedures for export products. These are also warnings to prevent deforestation for production land or the use of land originating from deforestation.

Proactive solutions

The EUDR is expected to be announced in June 2023, with a preparation period of 18 months for stakeholders. To proactively propose feasible solutions to support the coffee industry and key production areas to meet the EUDR requirements, the Department of Agriculture and Rural Development is coordinating with the Vietnam Sustainable Trade Initiative (IDH) to complete a pilot implementation plan in the whole province; support businesses and farmers to access new information and regulations of the EU to create a favorable legal corridor for exports to maintain the market and avoid future violations.

Coffee harvesting in Buon Ma Thuot city.

Localities need to proactively grasp the requirements of the EUDR, reorganize agricultural production towards modernity, green growth and sustainable development. The agricultural sector will advise the Provincial People's Committee to implement on the principle of inheritance, ease of implementation and low cost, meeting the requirements of the EU side."

Mr. Nguyen Hoai Duong, Director of Department of Agriculture and Rural Development

According to Ms. Tran Quynh Chi, Asia Director, Landscape Program (IDH), Dak Lak needs to pay attention to solutions on: Necessary information and data for reference maps to monitor coffee production causing deforestation; GPS/polygon positioning data for all coffee plantations; zoning coffee production areas according to high - medium - low risk levels of deforestation; traceability... Because currently, the EU's remote monitoring tool (using remote sensing images) will detect cases of deforestation based on nationally recognized and shared reference forest maps, to determine whether the loss/decline of forest cover at a certain GPS/polygon point is within the forest land area or not. Therefore, it is necessary to unify and provide an accurate reference forest map that accurately reflects the reality of forests and forest types in accordance with European regulations and definitions. In addition, plantation forests for timber, paper, and rubber latex also need to be reconfirmed to avoid the system recognizing them as natural forests. In addition, EUDR requires full traceability of coffee products to the plantation, so all coffee imported into the EU must have geolocation data (GPS/polygon) on the place of production. Therefore, it is necessary to have the participation of state agencies in sharing existing data, and at the same time develop a process to identify and list GPS/polygon data for all coffee plantations...

IDH also proposes that relevant parties develop a mechanism for sharing and responding to information when the European market detects and warns about deforestation at coffee production sites supplying to this market. At the same time, discuss programs and activities to support farmers in high-risk coffee areas, especially in ensuring livelihoods, raising awareness and other forms of encouraging reforestation/forest protection.

Minh Thuan - Minh Thong

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