JDE Peet’s, a major player in the global coffee industry, has voiced apprehension regarding the sector’s ability to comply with a new EU law prohibiting the import of commodities linked to deforestation worldwide. The law, set to take effect at the end of 2024, mandates that EU importers of coffee, cocoa, cattle, palm, and other commodities demonstrate that their goods are not contributing to forest destruction or face substantial fines.
The industry is facing a tight timeline to adhere to the law, with producing countries expressing concerns about the potential exclusion of small-scale farmers from the EU market due to challenges in meeting the law’s requirements. These concerns stem from the difficulty in providing geolocation coordinates to prove that farms are not on land deforested after 2020, a key stipulation of the law.
JDE Peet’s emphasized the tight timeline and the challenges the industry faces in complying with the law by the end of 2024. Laurent Sagarra, Vice President of Sustainability at JDE Peet’s, highlighted the industry’s efforts to meet the deadline, despite the practical challenges posed by the law’s requirements.
The company has engaged in agreements with several countries to map and monitor their coffee growing regions using advanced technology, but it still needs to sign deals with an additional 20 countries well before the end of this year to ensure continued coffee imports from various origins next year.
Sagarra acknowledged the complexity of achieving 100% compliance in the face of uncertainties but stressed the company’s commitment to doing everything possible to ensure readiness.
Furthermore, the company emphasized that the push to eliminate deforestation from supply chains extends beyond the EU, with climate-conscious consumers and investors pressuring companies worldwide to set targets for environmentally responsible supply chains. Sagarra highlighted that being deforestation-free is a competitive advantage, as coffee from high-deforestation countries may become less attractive in the future.
The process of complying with the law is expected to be costly, and the company underscored the broader industry trend of companies setting climate targets and focusing on environmentally responsible supply chains.