The new EU regulations aimed at curbing deforestation-related imports add another layer of complexity to the coffee market. Starting next year, the regulations will bar imports of coffee and six other commodities that have been grown in deforested areas from being sold in the EU.1) 2)
Food companies operating in the EU will also be required to geolocate the plots of land where their commodities are produced.3) 4)
According to Lavazza, only 20% of coffee farmers are prepared to meet these stringent regulations. This means European coffee roasters will need to source almost all their beans from Brazil, which is currently the only country ready for the new rules.5) 6)
The regulations could potentially cut off around 8 million coffee farmers from accessing the European market, further tightening the supply and driving up prices.7) 8)