Can smallholder farmers in Honduras and Guatemala export deforestation-free coffee to the European Union?

The new EU Regulation for Deforestation-Free Imports (EUDR) stipulates that by 2025, certain commodities may only be imported to the European Union if it can be proven that they have been produced on land that has not been subjected to deforestation or forest degradation. [Author] One of these commodities – coffee – is a source of income for farmers in Guatemala and Honduras, representing 14 percent and 52 percent of these countries’ agrifood exports respectively. [Author] In 2023, one fifth of all Guatemalan coffee and half of the coffee exported from Honduras was destined to the European Union, and the majority was produced by smallholders whose livelihoods face significant threats from climate change and rising production costs. [Author] In this context, the public and private actors who manage and govern the coffee supply chains in these countries must develop cost-effective traceability systems that can help farmers verify the deforestation-free origin of their coffee without worsening the economic pressures that they currently face. [Author] This report examines the economic and political structures of the coffee supply chains in Guatemala and Honduras with respect to potential traceability systems that could satisfy the requirements of the EUDR. [Author] This publication is part of the Country Investment Highlights series under the FAO Investment Centre's Knowledge for Investment (K4I) programme. [Author]