Bogor, February 7, 2025 – In a guest lecture delivered to 6th-semester students of the ESL Department as part of their capstone course preparation, Aisyah Sileuw discussed the European Union’s (EU) official adoption of the European Union Deforestation Regulation (EUDR) in 2023. This regulation aims to prevent products linked to legal and illegal deforestation from entering the European market. The regulation, which will be effective from December 30, 2025, will impact major Indonesian commodities such as palm oil, coffee, cocoa, rubber, timber, soybeans, and beef.

As the world’s leading supplier of palm oil (47% of EU palm oil imports came from Indonesia in 2021), Indonesia’s agricultural sector faces significant challenges in meeting the EUDR’s standards. The regulation requires all products entering the EU market to be deforestation-free after December 31, 2020, legally compliant, fully documented, and traceable. Requirements such as geolocation reporting, separating compliant and non-compliant supply chains, and proving land legality create a significant administrative burden, particularly for smallholders. The inability of independent farmers to meet these criteria is a major concern.

Indonesia’s Response and Adjustment Efforts

To address these challenges, Indonesia, along with Malaysia, has established a task force (Satgas EUDR) to advocate for smallholder interests and explore potential delays in implementing the EUDR for them. The Indonesian government is also developing a National Dashboard, a digital platform to monitor and record traceability data for commodities exported to the EU. Additionally, accelerating the implementation of the Plantation Cultivation Registration Certificate (STDB) for independent farmers is a key focus to meet land legality requirements. These measures are expected to enhance the competitiveness of Indonesian products in the global market while preserving environmental sustainability.

Implications for Sustainable Agricultural Development

The EUDR presents a dilemma between international trade demands and the protection of smallholder farmers in developing countries. On one hand, the regulation promotes sustainable agricultural practices and forest conservation. On the other hand, without adequate support, smallholders may lose access to global markets due to their inability to meet complex requirements.

However, if leveraged effectively, the EUDR could serve as a catalyst to improve land governance, enhance supply chain transparency, and encourage environmentally friendly farming practices in Indonesia. Active engagement from all stakeholders, including the government, private sector, and civil society, is crucial to the successful transition to a sustainable agricultural system that not only meets international standards but also supports the welfare of local farmers.