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EU ill-prepared to implement its own deforestation law, says grain trade association

Drought jeopardizes reforestation in Germany

By Maytaal Angel

LONDON (Reuters) - The European Union is ill-prepared to implement the bloc's new law aimed at banning the import of commodities and related goods linked to deforestation, an EU grain trade association said on Tuesday.

The law, which comes into effect end-December, requires importers of coffee, cocoa, beef, soy, rubber, timber and palm oil to prove their supply chains aren't contributing to deforestation anywhere in the world, or be fined up to 4% of their turnover inside the EU.

The rules apply equally to European farmers, who will be banned from exporting products cultivated on deforested land.

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The head of grain trade group Coceral, Iliana Axiotiades, said both the European Commission and European member state authorities in charge of implementing the European Union Deforestation Regulation (EUDR) are not ready.

"Even the information system, the IT the industry will need to feed (information into) is not ready," Axiotiades told delegates at an International Grains Council (IGC) conference in London.

Asked whether the landmark legislation, which in time could reshape global commodity markets, will be delayed, Axiotiades said: "I believe a decision will be made to take into account the lack of preparation".

In March, some 20 EU members asked Brussels to scale back and possibly suspend the EUDR, saying the policy would harm farmers.

EU leaders have watered down numerous environmental measures in an attempt to quell months of protests by angry farmers over issues including EU green policies and cheap imports.

Producing countries from Indonesia to Brazil have also criticised the law, saying it is discriminatory and that the new rules could end up excluding vulnerable, small-scale farmers from accessing the EU's lucrative market.

Their fear is that farmers in remote, rural regions might, for example, be unable to provide buyers of their goods with geolocation co-ordinates to prove their farms are not on land deforested after 2020 - one of the law's key requirements.

Commodity traders and consumer goods companies like JDE Peet's, one of the world's largest coffee companies, have meanwhile expressed concern their industry will not be able to meet the law's requirements on time.

(Reporting by Maytaal Angel; Editing by Ros Russell)