EU deforestation rules threaten West Africa cocoa

The European Union's Deforestation Regulation (EUDR), effective 30 December 2026 for large operators, requires cocoa importers to prove their beans were not grown on recently deforested land and to trace them to specific farms. West Africa, producing about 70% of global cocoa and shipping two-thirds to the EU, faces significant compliance challenges. In Nigeria, the world's fourth-largest producer, over half of the beans may fail to meet the rules due to the prevalence of small-scale farmers and limited traceability. Exporters like Sunbeth Global and Starlink Global and Ideal have invested heavily in mapping and tracing, incurring costs of $30-$80 per tonne, which European buyers have resisted absorbing, squeezing margins. In Ivory Coast, only about half of cocoa can be traced to origin, according to Trase. Industry experts warn of a potential two-year supply squeeze in the EU, during which compliant exporters could command premiums. The regulation aims to reduce deforestation but risks disproportionately burdening smallholder farmers and disrupting supply chains.