EU deforestation law ‘could marginalise rubber growers’

London - The EU is introducing anti-deforestation regulations to force all stakeholders in the rubber & tire value-chain to clarify whether or not any of the natural rubber being supplied, traded or used is linked to deforestation.

As such, the European law is “positive”: as it encouragesbuyers to take and cascade responsibilities across the entire complex value-chain, according to Paris-based sustainability consultancy Ksapa, in written comments to ERJ.

Potential problems, however, lie in imposing due diligence measures across the supply-chain, noted Kaspa, which among other activities, leads a project with Michelin to enhance the wellbeing and productivity of 6,000 small rubber plantation owners in Sri Lanka.

The EU regulation, explains Ksapa CEO Farid Baddache, will apply equally to the Brazilian beef and soy sectors – the main focus of deforestation, comprised mainly of farms of several hundred or even thousands of hectares (Ha) – as to the natural rubber sector, where more than 85% of production is carried out on farms of less than 2Ha.

And, he said, with challenging issues around how to pay for and allocate responsibilities to deliver compliance, the situation could lead to small producers being excluded from the more profitable and environmentally responsible markets.

This, warned Baddache, could result in “a two-tier agricultural production markets: one that complies with EU requirements for sustainable markets, the other that will be ‘for the rest of the world’ without any impact on the reduction of deforestation and putting small producers at social, economic and environmental risk.”

Meanwhile, a number of the value-chains targeted by EU regulators operate on several levels of inter-mediation, from the initial producer to the industrial exporter, continued the Ksapa leader.

Consequently, he said, “correspondence between administrative compliance and the reality of the physical flow of commodities will be difficult to verify,” particularly at the first level of these agricultural chains – production at farm level.

These administrative constraints “may very well place an additional operational burden on the shoulders of the most fragile players in these chains, who also do not have the means to invest in the technologies likely to collect the necessary information.”

Disparities could also emerge around the registration of farm information – quantities, coordinates etc – particularly where land-tenure is neither secure nor definitive, Baddache saying: “This is especially the case for hundreds of thousands of small and vulnerable farmers, whose level of education is often very low.”

According to the consultancy leader, key to the equitable implementation of the EU regulation will be to design and implement mechanisms that allow for the inclusion of small-scale farmers and then operate to their benefit.

And with many governments pushing hard to digitalise agricultural activities, the EU law could help to accelerate efforts to provide smallholders with increased access to digital technologies, Baddache suggested.

Overall, the Ksapa CEO believes the natural rubber value-chain needs to understand how best to ”onboard and positively impact smallholders at the far end of the chain.”

This, said Baddache, means avoiding expensive efforts around developing a top-down process, which is likely to have very limited impacts on the deforestation issue on the ground.