On May 22, 2025, the European Commission published its country risk benchmark under the European Union Deforestation Regulation (EUDR). This official list assigns a risk level to each exporting country of relevant products, directly impacting the obligations of companies aiming to access the European market.
Three Risk Levels for Assessing Compliance
Each country is now classified into one of three risk levels: low, standard, or high. This classification determines the intensity of checks required under due diligence. The higher the risk level, the more robust the evidence operators must provide regarding traceability, geographical origin, and environmental and social compliance.
Countries classified as low risk include all EU Member States, as well as other major economies such as the United States, China, Australia, Canada, and Vietnam. For these countries, evidence requirements are streamlined, as the risk of imported deforestation and systemic social issues is considered low.
Conversely, countries like Russia, Belarus, Myanmar, and North Korea are classified as high risk. In these cases, due diligence is deemed impossible or severely hindered due to the lack of reliable data, conflicts, or international sanctions.
Between these extremes, many countries essential to global supply chains are classified as standard risk. This includes Brazil, Indonesia, Malaysia, Argentina, Colombia, Mexico, Côte d’Ivoire, Nigeria, and Ghana. These countries account for a significant share of global production of raw materials covered by the EUDR.
A Two-Step Methodology
The classification is based on a rigorous methodology outlined in Article 29(3) of the regulation. It begins with a quantitative assessment using three key indicators: deforestation rate (based on FAO FRA 2020 data), expansion of agricultural land for the targeted commodities (according to FAOSTAT), and changes in their production.
A country is classified as low risk if it meets at least one of the following criteria: no net forest loss between 2015 and 2020, an annual deforestation rate below 0.2% and less than 70,000 hectares per year, or a loss of less than 1,000 hectares per year (for small countries). A fourth scenario applies to countries without agricultural expansion or increased production of the covered commodities.
When results are near the thresholds between risk levels, a qualitative assessment is added. This considers four dimensions: public policies, traceability mechanisms, governance, and participation in international agreements. Each criterion is scored from 1 to 5, and a country can be reclassified as low risk if the average score reaches or exceeds 3 out of 5.
Finally, any country subject to United Nations or European Union sanctions prohibiting the import or export of the relevant products is automatically classified as high risk, as due diligence is considered inapplicable.
A New Risk Map for Exporters
The May 22 benchmark redefines the global trade map towards the European Union. For companies, this means reassessing the structure of their supply chains based on each country’s classification.
Engaging with a country classified as standard or high risk requires enhanced traceability, thorough audits, and rigorous environmental and social documentation. These obligations can increase compliance costs, extend market access timelines, and strain relationships with certain suppliers.
Conversely, supply chains based in low-risk countries will benefit from simplified procedures, offering a competitive advantage amid increasing regulatory pressures.
Supply Logica Helps You Anticipate the Benchmark’s Effects
At Supply Logica, we assist companies in analyzing their exposure to country risks, geographically mapping their raw materials, centralizing compliance documents, and automating declarations in TRACES. Our solution enables compliance with the EUDR’s differentiated requirements based on country classification while enhancing the resilience and transparency of supply chains.
Supply Logica supports companies in implementing sustainable supply chains by ensuring product traceability, centralizing compliance data, and automatically generating due diligence declarations.
To discover how our solution can enhance traceability within your organization, contact our team.