The global market is shifting towards agricultural products that respect forests and adopt responsible business practices, driven by the Paris Agreement's goals to reduce emissions and protect ecosystems. In Latin America and the Caribbean (LAC), significant progress has been made in building sustainable and low-impact agrifood chains. The UN-REDD Programme, through the Food and Agriculture Organization of the United Nations (FAO) and in collaboration with various projects and initiatives, is playing a key role in supporting these advancements. 

Joining efforts, technical expertise, and initiatives related to sustainable agricultural markets and trade with those focused on reducing deforestation, in 2023, FAO and the Organization for Economic Co-operation and Development (OECD) launched the Business Handbook on Deforestation and Due Diligence in Agricultural Supply Chains. UN-REDD’s technical assistance facilitated the initiation of a capacity-building process, promoting the adoption of standards and best practices to achieve environmentally respectful agrifood chains among small and medium-sized enterprises in several Latin American countries.

The OECD-FAO Business Handbook on Deforestation and Due Diligence in Agricultural Supply Chains: A pillar for sustainable and low-impact agrifood chains

The OECD-FAO Handbook (available in English; and Spanish) provides guidance to companies and organizations on the environmental due diligence process, particularly in assessing and mitigating risks associated with deforestation and forest degradation. Its application is crucial for companies to adopt responsible practices, ensuring their supply chains do not contribute to deforestation or ecosystem degradation. The handbook outlines a five-step approach, illustrated in figure 1, which includes addressing and remedying negative impacts to promote responsible business conduct.

Figure 1. The Due Diligence Framework from the OECD-FAO Handbook

Success story

Since November 2023 and throughout 2024, various outreach and training activities have been carried out across Latin America, with specific cases in Colombia and Ecuador. These efforts involved close collaboration with companies and organizations to support the reduction of deforestation risks in agricultural supply chains and to promote actions that benefit forests. This process has not only facilitated the adoption of sustainable practices in the agrifood sector but also fostered a platform for collaboration and mutual learning across the region.

Through technical assistance and the use of the handbook, two pioneering coffee production companies located in the departments of Antioquia and Huila, Colombia, have strengthened their due diligence processes. They have expanded their monitoring and verification coverage to include more suppliers and direct producers, including farming families. This effort has been pivotal in improving product traceability and ensuring compliance with required sustainability standards.

Gustavo Gómez, Sustainability Director at Green Coffee Company (GCC), the largest sustainable coffee producer in Colombia, stated: "The Handbook has been instrumental in establishing a comprehensive due diligence process, fostering shared responsibility within the framework of corporate policies. This approach goes beyond mere compliance with global regulations, enabling a deforestation risk analysis and the development of a mitigation plan that directly contributes to forest health. It has also raised awareness among technical teams, ensuring that during harvest supervision and other field activities, processes for reporting through the petition, complaints, and claims (PQR) system are strengthened. Furthermore, the Handbook has inspired the identification of critical deforestation hotspots, allowing for more effective control and the implementation of exemplary sanctions against those found responsible for tree cutting after investigation."

Carlos Gómez, Supply Chain Assurance Specialist at CÓNDOR Specialty Coffee, also explained:

"The Handbook was the starting point for understanding the due diligence process and developing the corresponding policy within the company. A significant milestone was mapping the supply chain, which became the foundation for subsequent actions, such as verifying the legal compliance of direct and indirect suppliers in protected zones, natural areas, and protected areas, ensuring that productive farms are located within areas authorized for agriculture in Colombia." According to Gómez, this supply chain mapping has enabled the development of a deforestation risk analysis exercise.

In addition, training sessions have been conducted for 37 companies in the coffee and cocoa sectors, helping them mitigate their deforestation-related risks and address the challenge of complying with global deforestation regulations. These training sessions have increased the companies' confidence in their ability to meet the requirements, and in some cases, have highlighted the need to conduct gap analyses between their current processes and market demands.

Scaling up while maintaining focus on small producers and supporting deforestation risk mitigation in coffee production, FAO – within the framework of UN-REDD technical assistance – initiated a technical cooperation with the National Federation of Coffee Growers of Colombia to develop a due diligence process that will benefit over 500,000 coffee farming families. This effort is crucial for strengthening the sustainability of coffee production and ensuring that farmers who wish to meet international environmental protection standards are empowered and prepared to do so.

Through the implementation of the five steps outlined in the OECD-FAO Handbook, the Federation is documenting its management strategies and risk identification and mitigation efforts related to deforestation. This approach aims to create a sustainable, forest-friendly agricultural chain, aligning with the national commitments set forth under the Paris Agreement. This process not only promotes environmental conservation but also strengthens the position of the Colombian coffee sector in international markets that prioritize sustainable practices.

Andrea Verú Torres, Director of Environmental Management at the National Federation of Coffee Growers of Colombia, commented: "The most important aspect for us has been respecting our capabilities and realities, as well as acknowledging the progress we’ve made and understanding the challenges associated with the risks we face due to the vast diversity of territories we manage."

Since the beginning of 2024, the National Federation of Coffee Growers has developed its corporate environmental sustainability policy, which reflects its commitment to deforestation-free coffee production. Andrea Verú added: "This progress marks a significant step and opens the door for us to develop more documents, indicators, plans, programs, and projects that contribute to the overall goal of the policy: a firm commitment to zero deforestation, sustainable land use, degradation prevention, and forest protection. These clearly defined priorities provide us with a solid framework to move forward with the implementation of the next steps of the handbook and address risk assessment and the development of a mitigation plan."

Bilateral dialogues and regional learnings

Following the workshop held in Lima, Peru, in April 2024, with the participation of seven countries from the region to discuss the integration of sustainability in agrifood chains and agricultural product traceability systems, bilateral dialogues between countries were promoted. One example of this was the bilateral exchange facilitated by FAO between the Ministry of Agriculture of Colombia and the Ministry of Agrarian Development and Irrigation of Peru, where lessons learned from the traceability system implemented in Peru were shared. This system has become a model of transparency in the region for tracking and demonstrating that the supply chains of staple and agricultural products are not negatively impacting forests.

Building on this, the Ministry of Agriculture and Rural Development of Colombia has taken these best practices into consideration to adapt them to its own context, as part of a national agricultural traceability process it aims to implement.

Building a roadmap towards sustainable and low-impact productive chains in the forests of Ecuador

In the case of Ecuador, support has been provided in the development of a roadmap to be implemented through the inter-institutional committee for Sustainable Production and Marketing, which includes the Ministry of Environment, Water, and Ecological Transition, the Ministry of Agriculture and Livestock, and the Ministry of Production, Foreign Trade, Investments, and Fisheries. The goal is to achieve sustainable agricultural chains with low forest impact, facilitating the assessment of deforestation risks associated with supply sources, under frameworks of good governance and data management.

Challenges and opportunities

Meeting the commitments made by countries under the Nationally Determined Contributions (NDCs) and the Paris Agreement, as well as complying with global regulations related to deforestation reduction in value chains, such as the EU Deforestation Regulation, presents significant challenges. These regulations require traceability for key products like coffee, cocoa, palm oil, and soy, and demand ongoing efforts to mitigate deforestation. Achieving this will require increased investments, inter-institutional collaboration, technical support for small producers, and the strengthening of technical and local capacities to implement effective regulations in an integrated and sustainable manner.

However, these challenges also present key opportunities to transform agricultural systems in the region. By fostering strategic partnerships between businesses, governments, and civil society, more sustainable agriculture in Latin America and the Caribbean can be promoted. With a collaborative approach, it will be possible to move towards agricultural production that not only meets international regulations but also promotes inclusive rural development and a greener, more prosperous future for the entire region.

Authors:

Florence Bernard, Forestry Officer, REDD+/Deforestation, Degradation, and Emissions Team, Technical Lead for Agriculture and Forests Linkages, Forestry Division, FAO

Nhaydú Bohórquez, Expert in Forest Positive Value Chains and REDD+ Forest Governance – Latin America, FAO

This article was originally published by UN-REDD Programme

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