31 ONTARIO GRAIN FARMER FEBRUARY 2024 In 2023, the EU adopted a deforestation regulation (EUDR) to prevent the EU market entry of soybeans and soy-based products produced on land deforested after December 31, 2020. While this regulation is responding to EU concerns about soy originating from countries with a high risk of deforestation, it is being applied broadly to all countries, regardless of their land-use change levels or the circumstances of conversion. When compliance requirements enter into force in January 2025, EU soy importers will need to proactively conduct due diligence across a wide range of compliance obligations. The regulation text is highly prescriptive and will necessitate an unprecedented level of traceability and segregation within global value chains. Compliance requires proactively ensuring products are deforestation-free, produced in accordance with relevant local laws, and accompanied by a due diligence statement. The due diligence statement confirms that a thorough assessment found no or negligible risk of deforestation. Most significantly, the regulation requires importers to report, for each shipment, the GPS coordinates of all non-adjoining plots of land where the relevant commodities were produced. This differs from the CFR GPS requirement, which only necessitates the longitude and latitude of the primary farm address to signify the crops were grown in Canada. The EUDR coordinate requirement was established so that the EU can use publicly available satellite images and positioning to check whether the land has been converted from forest to agricultural use since 2020. Grain Farmers of Ontario and Soy Canada have been clear with the EU and Canadian governments that this level of traceability would introduce enormous complexity and cost to the commodity value chain, and have been engaging with the government and the value chain to explore opportunities to streamline compliance where possible to ensure that Canada can maintain EU market access for qualifying crops. Options for broad industry solutions to compliance may be limited, given the rigidity and specificity of the regulation. As pathways become clearer, Grain Farmers of Ontario and its partners will communicate with farmers on these data requirements. Dana Dickerson is Grain Farmers of Ontario’s manager of market development and sustainability.• If your crops are sold into the Canadian biofuels market (e.g., ethanol), you may be asked to complete an annual harvest declaration for your grain customers so that your crops can be compliant with Canada’s Clean Fuel Regulations. This will include providing the GPS coordinates (longitude and latitude) associated with your primary farm address. Starting in 2025 (including for crops harvested in 2024), only soybeans produced on land that has not been deforested since 2020 will be eligible for export to the EU. It is not yet clear how the value chain will facilitate compliance and verification of this, but declarations and the provision of field-specific GPS coordinates may be required for verification purposes. WHAT WILL THESE NEW REGULATIONS MEAN FOR YOUR FARM IN 2024? PHOTO COURTESY OF LAURA FERRIER
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