EU nations push for softer deforestation rules amid trade concerns
A letter obtained by Reuters reveals that 18 EU agriculture ministers have urged the European Commission to exempt low-risk nations from strict due diligence rules.
The law, set to take effect in December, mandates that companies importing soy, beef, palm oil, and other commodities into the EU must prove their products did not contribute to deforestation.
Forests play a crucial role in absorbing CO2, and their destruction accelerates climate change.
However, political resistance has grown as governments weigh economic costs against environmental benefits.
The EU has already delayed the policy's implementation by a year and eased reporting obligations following backlash from trading partners, including the U.S., and some member states.
The latest push seeks additional concessions, particularly for countries where agricultural expansion does not significantly reduce forest cover.
'Excessive and redundant due diligence requirements should be removed in countries where agricultural expansion is not significantly reducing the forest area,' the letter stated.
Signatories include Austria, Finland, Italy, Poland, and Sweden, among others.
Another concern is the law's impact on EU-based producers, who fear losing competitiveness if forced to comply with stringent traceability rules.
The ministers warned that some commodities may face 'extremely difficult, if not impossible' compliance hurdles, potentially driving businesses to relocate outside the bloc.
The group also suggested another delay in enforcement while the Commission works on simplifying regulations.
A Commission spokesperson did not immediately respond to requests for comment.
The deforestation law aims to curb the 10% of global forest loss tied to EU consumption.
Critics argue that without balanced enforcement, the policy could harm farmers and disrupt supply chains without delivering meaningful environmental gains. - Reuters
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
New Straits Times
19 minutes ago
- New Straits Times
Copper prices ease on trade tariff uncertainty, Chile supply outlook
SINGAPORE: Copper prices eased on the London Metal Exchange and Shanghai Futures Exchange on Tuesday, as uncertainty over US trade tariffs and the potential for increased copper supply from Chile, the world's largest producer, weighed on the market. Three-month copper on the LME was down 0.2 per cent at US$9,810 per metric ton, as of 0109 GMT, and the most-traded copper contract on the SHFE eased 0.16 per cent to 79,380 yuan (US$11,064.34) a ton. Still, both contracts were trading at their high levels since April. The United States sent formal notices to 14 countries on Monday announcing new tariffs ranging from 25 per cent to 40 per cent, set to take effect on August 1. Additionally, US President Donald Trump warned that an extra 10 per cent tariff could be imposed on BRICS nations, including Brazil, Russia, India, and China, if they pursue what he described as "anti-American" policies during their summit in Brazil. "The market focus is still very much on the US trade tariffs, as all have not been finalized, and higher copper export value from Chile probably suggests a higher supply volume," said a Beijing-based metals analyst from a futures company. Chile exported US$4.67 billion worth of copper in June, marking an increase of 17.5 per cent in the year-ago period. "Chilean copper mines had their best month of export revenue in over three years in June," ANZ said. Copper is still flowing to the US, as Washington's ongoing investigation into potential new copper import tariffs keeps the premium of COMEX copper futures over the LME benchmark elevated, and the COMEX copper stocks are at a seven-year high, or up 120 per cent since mid-February. LME nickel edged 0.18 per cent lower to US$15,150 a ton, while zinc gained 0.24 per cent to US$2,691, tin inched up 0.12 per cent to US$33,325, and aluminium up 0.1 per cent at US$2,576. SHFE zinc lost 0.68 per cent to 22,035 yuan a ton, lead fell 0.55 per cent to 17,115 yuan, nickel went down 0.53 per cent to 120,540 yuan, and tin dropped 0.5 per cent to 264,360 yuan.
New Straits Times
19 minutes ago
- New Straits Times
Yen stumbles as Trump imposes 25pct tariffs on Japan
SINGAPORE: The yen fell broadly on Tuesday while the dollar held steady as US President Donald Trump unveiled 25 per cent tariffs on goods from Japan and South Korea in the latest development of his chaotic trade war. Trump on Monday began telling trade partners – from powerhouse suppliers like Japan and South Korea to minor players – that sharply higher US tariffs will start Aug 1. He later said that he was open to extensions if countries made proposals. The announcement rattled investor sentiment, sending the Japanese yen and South Korean won down roughly one per cent overnight. Both currencies remained under pressure early on Tuesday, with the yen falling to a two-week low of 146.44 per US dollar. The won rose 0.4 per cent to 1,370.20 per US dollar. Investors entered the week with much confusion over Trump's tariff plans ahead of an initial July 9 deadline. While the new Aug 1 date offers a brief reprieve, the outlook remains uncertain and global economic concerns persist. "There is still a lot of uncertainty as to where tariff rates will eventually settle and which countries will get what rates, so uncertainty about the global economy is still high and that will keep investors on edge for the time being," said Carol Kong, a currency strategist at Commonwealth Bank of Australia. "This is just the start and we'll get more headlines out for sure over the coming days." Japanese Prime Minister Shigeru Ishiba said on Tuesday that Japan would continue negotiations with the United States to seek a trade deal that benefits both countries. South Korea has said it plans to intensify trade talks with the US and views Trump's plan for a 25 per cent tariff from Aug 1 as effectively extending a grace period on implementing reciprocal tariffs. Other currencies meanwhile gained some ground on Tuesday, after sliding in the prior session when the dollar rebounded. The euro was up 0.27 per cent to US$1.1741 after having slid 0.67 per cent on Monday, while sterling edged up 0.17 per cent to US$1.3626. The European Union will not receive a letter from the United States setting out higher tariffs, EU sources familiar with the matter told Reuters on Monday, and is eyeing possible exemptions from the US baseline levy of 10 per cent. DOLLAR HOLDS GAINS Against a basket of currencies, the dollar was little changed at 97.40, holding on to most of its gains from Monday when it rose 0.5 per cent. The Australian dollar last traded 0.32 per cent higher at US$0.6513, having tumbled 0.9 per cent in the previous session as risk appetite soured. The New Zealand dollar advanced 0.22 per cent to US$0.6015, reversing some of Monday's 0.8 per cent fall. The Reserve Bank of Australia announces its rate decision later on Tuesday, where expectations are for the central bank to deliver another rate cut owing to easing inflation and a slowing economy. "Given the ever-shifting balance of risks and the heightened uncertainty it creates for hiring and investment in the Australian economy, more RBA cuts are set to follow," said Carl Ang, fixed income research analyst at MFS Investment Management. "A 3.10 per cent terminal rate by early 2026 remains the base case for this RBA cutting cycle."
New Straits Times
34 minutes ago
- New Straits Times
Shares steady, dollar firms on US tariff letters; oil dips
TOKYO: Stock markets in Asia took in stride the latest twist in US President Donald Trump's tariff roll-out on Tuesday, as the dollar held onto gains and oil retreated. Shares on Wall Street fell after Trump sent letters to 14 countries, including Japan and South Korea, unveiling sharply higher tariffs on imports into the United States, while also postponing their implementation to Aug 1. Japan's Nikkei stock gauge opened lower but then turned positive after Trump described that deadline as "firm, but not 100 per cent firm" and said tariffs may be adjusted for some countries. The Aussie dollar rose ahead of a Reserve Bank of Australia decision later in the day. Market reaction to the tariff announcements was muted on memories of Trump's rapid walk back of his "Liberation Day" duties initially set out on April 2, said Tapas Strickland, head of market economics at National Australia Bank. "There's going to be a lot of volatility as the headlines start to emerge, as more of these letters come out, and as the negotiations really come to the fore ahead of that Aug 1 deadline," Strickland said on an NAB podcast. In April, Trump capped all of the so-called reciprocal tariffs with trading partners at 10 per cent until July 9 to allow for negotiations. Only two agreements, with Britain and Vietnam, have been reached. In June, Washington and Beijing agreed on a framework covering tariff rates, restoring a fragile truce in their trade war. Tariffs on Japan and South Korea are now due to go up to 25 per cent on Aug 1. Japanese Prime Minister Shigeru Ishiba called the hike deeply regrettable and said his nation would continue negotiations with the US. The European Union will not be receiving a letter setting out higher tariffs, EU sources familiar with the matter told Reuters on Monday. The EU still aims to reach a trade deal by Wednesday after European Commission President Ursula von der Leyen and Trump had a "good exchange," a commission spokesperson said. MSCI's broadest index of Asia-Pacific shares outside Japan was up 0.2 per cent in early trade. Japan's Nikkei stock index rose 0.4 per cent while South Korea's KOSPI jumped 1.5 per cent. The dollar rose 0.2 per cent to 146.36 yen, touching a two-week high. The euro was flat at US$1.1741. The Aussie advanced 0.4 per cent to US$0.6516 before a meeting by the central bank where policymakers are widely expected to deliver a 25-basis-point cut. US crude dipped 0.5 per cent to US$67.59 a barrel after surging nearly 2 per cent on Monday. Spot gold edged 0.2 per cent lower. In early trade, pan-region Euro Stoxx 50 futures were down 0.1 per cent, German DAX futures were down 0.1 per cent at 24,133, and FTSE futures slid 0.3 per cent.
