The United Kingdom (UK) has recently adopted legislation on deforestation-free supply chains, and the European Union (EU) has proposed a similar approach. In this paper, the authors examined whether supply chains for key sectors in Brazil were prepared for compliance, namely cattle, cocoa, coffee, palm oil, soy bean and tropical timber. Though some sectors are well-placed, others face greater hurdles to compliance.
New regulations in the UK and EU aim to target global commodity-driven deforestation and forest degradation. The authors of this paper constructed a “Compliance Likelihood Index” in order to assess how different sectors in Brazil would be able to work with this new and forthcoming legislation. The index provides information for policymakers and stakeholders who will need to work to support suppliers to meet requirements and manage Brazil’s relationship with UK and EU markets.
Though researchers found that Brazil’s coffee sector was well-placed for compliance with incoming regulations, cocoa and cattle were a different story: amongst other hurdles, the UK and EU are not key markets for Brazilian cocoa and beef, so there is low incentive for compliance.
To increase the likelihood of compliance, the researchers suggested two key actions. Firstly, as the UK and EU introduce this legislation, they should focus on providing resources, both financial and technical, to help smallholders to implement any compliance-related measures. Secondly, Brazil needs to adopt further domestic policies and regulations of its own: currently the new legislation is attempting to regulate areas that are not yet regulated by Brazil itself. Bilateral collaboration will be key to making these new rules a success.
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