Ethiopia’s coffee sector faces EUDR compliance challenges as stakeholders validate key assessment

The Ethiopian coffee sector, a vital pillar of the nation’s economy, is navigating a critical juncture as it prepares to comply with the European Union Deforestation Regulation (EUDR). The regulation, which takes effect in December 2025, aims to halt the import of commodities linked to deforestation into the EU. Given that coffee accounts for one-third of Ethiopia’s total exports, with the EU being a major trading partner, the stakes are high.
The challenge of EUDR compliance

The EUDR, endorsed on May 31, 2023, prohibits the export of seven commodities to the EU if sourced from land deforested after December 31, 2020. For Ethiopia, this regulation poses significant challenges, particularly in ensuring that its coffee meets stringent traceability and sustainability requirements.

To address these challenges, SWR Ethiopia, through its RAISE FS project, assessed Ethiopia’s coffee value chain. The findings were presented to stakeholders in a validation workshop held on March 13, 2025. The study highlighted several critical issues:

Awareness gap: nearly half of the smallholders and traders interviewed were unaware of the EUDR and its compliance measures.

Ongoing compliance efforts: various stakeholders, including government bodies, development partners, and private sector actors, have initiated steps toward compliance.

Operational challenges: key hurdles include small farm sizes complicating geo-location efforts, unclear definitions of deforestation and biodiversity degradation, aggregation practices that hinder traceability, insufficient infrastructure, and uncertainty over who will bear the additional compliance costs.

Recommendations for compliance

The assessment offered a series of recommendations to ensure Ethiopia’s coffee sector aligns with EUDR requirements:

• Develop a clear compliance checklist for all stakeholders.
• Provide precise definitions for deforestation and biodiversity degradation.
• Zone coffee-producing areas specifically for EU exports and finalize geo-location mapping.
• Establish user-friendly traceability systems.
• Strengthen regulatory bodies to oversee traceability and value chain operations effectively.
• Enhance capacity-building initiatives to enable proper management and segregation of EU-bound coffee from other exports.
• Reinforce the newly established national coffee platform to foster collaboration among stakeholders.

During the workshop, stakeholders emphasized the urgency of geo-location mapping as a cornerstone for EUDR compliance. They called for immediate infrastructure development ahead of the deadline and underscored the importance of awareness campaigns across the value chain to ensure coordinated efforts. Collaboration among government agencies, private sector actors, and development partners was deemed essential to create synergy.
Participants also discussed the need to zone coffee-producing areas exporting to the EU. This would not only facilitate compliance but also enable tailored extension services, capacity building, and infrastructure development. Revisiting land use rights and trade regulations was also highlighted as critical to aligning with EUDR requirements.
As Ethiopia races against time to meet EUDR standards, building confidence among value chain operators is seen as crucial for sustaining EU exports beyond the December 31, 2025, deadline. Strict government controls will be necessary to ensure that no exported coffee originates from deforested areas.

The regulation’s focus on forest protection, traceability, and geo-location presents both challenges and opportunities for Ethiopia’s coffee sector. While compliance will require significant investments in infrastructure and capacity building, it also offers a pathway to enhance the global competitiveness of Ethiopian coffee by aligning with international sustainability standards.

As Ethiopia braces for additional EU regulations in the future, aligning land use rights and trade policies with EUDR requirements will be crucial. With coordinated efforts and timely action, Ethiopia’s coffee sector can rise to meet this challenge while safeguarding its vital contribution to the national economy. The workshop concluded with a consensus on the need for strict government controls to ensure that no exported coffee originates from deforested areas.