Table of Index
Executive Summary
Agriculture is a major driver of deforestation, with 10% of global forest cover lost in the past 30 years. To promote sustainability, the EU introduced EUDR, requiring companies to verify commodity origins, conduct due diligence, and implement traceability in their supply chains (European Commission: 2023 & Deloitte: n.d.).
Originally set for 2024, EUDR enforcement is postponed to 30 December 2025 for large companies and 30 June 2026 for small businesses. Country risk classifications will be finalized by June 2025 (Tax News, 2025).
According to Luca, this delay presents a major opportunity by creating a level playing field and enforcing compliance across all businesses. It also enhances supply chain transparency and brings greater focus to supporting smallholder producers through traceability and financial access.
Agriculture is vital to global economies but remains a major driver of deforestation, with 10% of the world’s forest cover lost over the past 30 years (European Comission: 2023). As concerns over forest degradation, biodiversity loss, and climate change grow, regulatory measures like the EU Deforestation Regulation (EUDR) have been introduced to ensure sustainable and transparent supply chains.
The EUDR aims to reduce the EU market's impact on global deforestation, forest degradation, and biodiversity loss by promoting deforestation-free supply chains, lowering GHG emissions, and protecting human and Indigenous rights. To comply, companies must conduct due diligence, verify commodity origins, ensure supplier adherence to environmental and social regulations, and implement traceability systems to track products from farm to market (Deloitte: n.d.)
The EUDR implementation, originally set for 30 December 2024, has been postponed by 12 months due to the complexity of mapping supply chains and public scrutiny. Following negotiations, the EU Council and Commission rejected additional changes proposed by the European Parliament, finalizing the delay. As published on 23 December 2024, medium and large companies must comply by 30 December 2025, while small and micro businesses have until 30 June 2026. The EU Commission will classify countries by deforestation risk by 30 June 2025, with special rules applying to timber products (Tax News:2025).
To gain deeper insights into the implications of EUDR and how businesses are adapting, we spoke with Luca Fischer, Senior Head of Market Indonesia at Koltiva. In this Q&A, Luca shares his perspectives on industry challenges, compliance strategies, and the role of technology in building sustainable, deforestation-free supply chains.
Q: Can you tell me about yourself, your work experience, education, and your journey in agriculture? What brought you to choose this path, and are there any values you prioritize in your work?
LF: I have been interested in the agricultural sector and smallholder farming for quite some time. During my bachelor’s program, in my third year, I had the opportunity to work for a cocoa cooperative in Ecuador, in the Amazon region. This cooperative was unique because it was owned by Indigenous families who produced their own chocolate.
They would ferment the cocoa and, on weekends, rent a factory to produce chocolate together. Their farms were amazing—traditional agroforestry farms where producers would explain the various tree species and plants, highlighting their uses, like treating headaches or brushing teeth. The depth of traditional knowledge they had was impressive.
I grew up in a small village in Germany and spent a lot of time on a dairy farm. However, I never truly connected with farming until I was in Ecuador. That experience made me interested in working with smallholder producers and exploring how to protect existing forests while ensuring the livelihood of rural communities. That was about ten years ago.
Since then, I have built my career in this space. One key principle I’ve always believed in is the need for sustainable business models. While donor-funded projects can be enablers, I think creating a self-sustaining business that generates profit while reinvesting in communities and environmental protection is crucial.
Q: From your experience, what do you see as the biggest current issue in agriculture?
LF: It depends on the perspective. From a smallholder producer ’s perspective, the biggest issue is price. Producers are not paid enough within the value chain, as much of the margin ends up with larger corporations. The challenge is creating a supply chain that incentivizes producers—whether through premium payments for better quality or sustainability practices—to increase their earnings.
For example, in Indonesia, rubber producers often stop tapping their trees because prices are too low. Another issue is the scale of plantations. Many smallholders have only one or two hectares, which is not enough to provide a stable income. For certain commodities, like palm oil, a producer would need at least four or five hectares to be able to generate enough income for their family, save money, and invest in education.
From an environmental perspective, climate change and deforestation are interlinked. Deforestation reduces carbon sinks, accelerating climate change, which in turn disrupts farming through extreme weather events like floods and droughts. Producers will struggle to adapt to these rapid changes, making their livelihoods even more vulnerable.
Q: The EUDR (EU Deforestation Regulation) has delayed. What is your perspective on this regulation? Do you see it as a challenge or an opportunity?
LF: I see it as a big opportunity for everyone. For companies, it creates a level playing field, ensuring that all businesses must comply with the same standards. Many of our clients had already taken steps toward sustainability before this regulation was introduced.
What EUDR does is push all companies—not just the big names in the media spotlight—to comply. It also creates economic opportunities for actors in the supply chain. For example, natural rubber processors are now making a profit again because compliance gives them a competitive advantage.
Additionally, this regulation has brought smallholder producers into focus. Previously, companies claimed they supported smallholders, but there was little actual data on them. With traceability requirements, we now know where these producers are, what challenges they face, and how they can be supported—whether through land legalization or financial access like supply chain loans.
Q: Despite its benefits, are there disadvantages for smallholder producers? How can we bridge the gap to ensure they are not left behind, especially those struggling with technology or land legality issues?
LF: Yes, there are challenges. One misconception was that producers could simply use an app to map their land and submit data by themself. Many producers are still digitally illiterate, lack internet access, and require guidance of what and how to collect it and share the data.
To address this, support programs are necessary. Companies need to work directly with producers, explaining the regulations, helping them legalize their land, and ensuring they understand how compliance benefits them. Our clients value not only our digital solutions but also our on-the-ground services. We need people visiting farms, working with producers, and guiding them through these requirements.
KoltiSkills Extension Services
As a global EUDR compliance provider with users in 65 countries, we offer comprehensive support for businesses. Beyond EUDR, our field agents provide on-site supply chain mapping, verification, and capacity building through our agronomists.
Supply Chain Mapping and Verification
While mapping producers and farms, Our field Agents work closely with processors and suppliers to chart smallholders within their supply chains. They conduct in-depth farm and risk assessments for each producer, utilizing the KoltiTrace application for a comprehensive understanding of associated risks within the agricultural landscape.
Training & Coaching
Group training raises sustainable practices awareness, while one-on-one coaching supports producer households in implementing farm development plans. Koltiva uses data insights to tailor interventions addressing producers' challenges.
Land Legality & Certification
Many producers lack essential EUDR compliance documents. Koltiva's field team collaborates with local governments, aiding producers in obtaining required legal compliance documents and support them to be certified with RA, FairTrade, FSC and other voluntary standards.
Product Traceability
For precise traceability recording, local operators require support and training. We specialize in digitalizing business operations, covering the entire journey from seed to table. Tailored to client objectives, we help confirm supply chain links through product traceability. Our focus lies in monitoring field operations to ensure product segregation and uphold quality control throughout the seed-to-table process.
Q: With the EUDR implementation delayed at the end of last year, do you see this as a challenge or an opportunity?
LF: Many companies had already invested millions in preparing their supply chains, seeing compliance as a competitive advantage. A delay in policy creates uncertainty, which is never good. It makes companies question whether regulations will actually be enforced.
However, the European Commission made it clear that they are only delaying the regulation by one year, not watering it down. This provides an opportunity. At the end of last year, many companies weren’t fully prepared, and the EU’s information system still had technical issues. The extra time allows businesses to reduce their risk of non-compliance and ensure a smoother transition.
Q: How do you see the role of technology, particularly Koltiva’s solutions, in addressing agricultural challenges related to EUDR?
LF: Preparing for EUDR generates an overwhelming amount of data. Manually handling due diligence reports is inefficient. Digital solutions streamline this by collecting, organizing, and automating data submission for shipments, saving time and effort.
For example, our KoltiTrace solution helps both upstream and downstream players by ensuring data accuracy, assessing risks, and maintaining compliance records. Since EUDR requires companies to store data for at least five years, having an organized digital system makes it easier to respond to regulatory checks.
Additionally, many procurement officers spent last year focusing solely on EUDR instead of their core tasks. Automation allows them to return to look beyond compliance.
Q: You have worked with various clients in achieving EUDR compliance. What are the most challenging aspects of fulfilling its requirements?
LF: The process happens in phases and takes time. First, companies must understand their requirements for the regulation and their buyers. If their supply chain isn’t digitalized, they must map their supply chain which can be very time consuming. A major challenge here is data quality – how will you ensure to not only collect the data in time but also align it to the highest quality standards.
Once data is collected, it must be formatted correctly for regulatory submission, which can be another hurdle. Finally, companies need to address non-compliance risks—such as deforestation alerts or land legality issues—and find ways to segregate non-compliant materials from their shipments. Compliance is a journey which will take time.
Q: Are the challenges different between upstream and downstream players?
LF: Definitely. Upstream players need to directly map their supply chains, while downstream players must refine their due diligence processes, including the evaluation of each suppliers’ risk assessment.
Last year, many downstream companies rushed to meet requirements, which allowed a lot of products to qualify as EUDR compliant. However, now downstream players have time to optimize their processes. They must figure out how to automate data collection, ensure compliance effectively, and build a reliable due diligence system.
Failure to comply with EUDR can result in significant penalties, including fines, trade restrictions, and reputational damage. Speak with our expert to understand compliance requirements, mitigate risks, and ensure your supply chain aligns with sustainability regulations!
Writer: Kumara Anggita, Content Writer
Editor: Bobby Hermawan, Head of Digital Marketing and Daniel Prasetyo, Head of Public Relations and Corporate Communications.
About Writer:
Kumara Anggita, serving as Koltiva's dedicated Content Writer, brings a wealth of experience from her six-year tenure in journalism in the fields of humanities and lifestyle, as well as her role as a writer in the tech industry. Her deep-rooted passion for gender equality and sustainability spurred her to enhance her reporting and storytelling skills through the EmPower Media Bootcamp by UN Women. Now, Kumara utilizes her platform to advocate for sustainable practices and gender equality through her compelling writing.
Resources
European Commission. (2023). EU Observatory covering deforestation and forest degradation worldwide goes live. Retrieved from https://joint-research-centre.ec.europa.eu/jrc-news-and-updates/eu-observatory-covering-deforestation-and-forest-degradation-worldwide-goes-live-2023-12-08_en
Deloitte. (n.d.). EU Deforestation-free Regulation (EUDR). Retrieved from https://www.deloitte.com/nl/en/issues/climate/eudr-eu-deforestation-free-regulation.html
EY Tax News. (2025). EU deforestation regulation now postponed by 12 months. Retrieved from https://taxnews.ey.com/news/2025-0127-eu-deforestation-regulation-now-postponed-by-12-months
