KOLTIVA Urges Inclusive Segregation to Prevent Smallholder EUDR Exclusion

With the European Union’s Deforestation Regulation (EUDR) enforcement date approaching, a new analysis reveals that global supply chains are alarmingly unprepared, prompting AgriTech firm KOLTIVA to urge for “inclusive segregation” to prevent the exclusion of small-scale farmers.

According to a 2025 Forbes analysis, only 30% of upstream suppliers and a mere 12% of downstream companies have traceability systems in place to monitor deforestation risks, placing billions of dollars in EU-bound trade in jeopardy.

The EUDR mandates that commodities like rubber, palm oil, and coffee must be physically separated throughout the entire supply chain, from harvest to export, to ensure products from deforested land do not mix with compliant ones. Any shipment containing a blend of compliant and non-compliant goods—including those from land deforested after December 31, 2020, or those with unknown origins—will be barred from entering the EU market. KOLTIVA, a Swiss-Indonesian firm specializing in sustainable supply chains, warns that this segregation requirement is a critical and often overlooked hurdle for agribusinesses.

The challenge is especially acute for supply chains involving smallholder farmers, who are essential to sustainable commodity production.

“Achieving full physical segregation when sourcing from smallholders is a significant challenge,” said Andre Mawardhi, Senior Manager for Agriculture and Environment at KOLTIVA. “These supply chains are often intricate, with many points where mixing can inadvertently happen… Some companies may choose to exclude sourcing from smallholders to simplify compliance, but that approach risks marginalizing farmers”.

Many smallholders manage multiple plots of land, some of which may be EUDR-compliant while others are not, creating a high risk of harvests being mixed.

Rahman Sarwono, a rubber farmer in East Kalimantan working to meet EUDR standards, highlighted the need for support. “I understand the mapping helps define plot boundaries. If we’re trained to separate harvests between mapped and unmapped plots… it will really help us,” he said. “As farmers, we’re committed to comply, but we also need support, training, education… Otherwise, even a small mistake can shut us out of the market altogether”.

To navigate this complexity, KOLTIVA has outlined a multi-step approach for businesses:

• Verify Compliance and Documentation: This includes mapping farms with legal land use, confirming no deforestation risk, and ensuring all actors meet environmental and social standards. Physical and documented separation of materials from origin to export is essential.
• Implement a Traceability System: Use digital tools like mobile apps to enable end-to-end tracking and verify deforestation-free sourcing.
• Develop Segregated Handling and Storage: Utilize dedicated warehouses, separate transportation, and consistent labeling to maintain the purity of compliant goods.
• Provide Field Training and Monitoring: Consistently train farmers, dealers, and suppliers on segregation practices and monitor for compliance to correct any gaps.

Indryani Bali, Project Leader for the Rubber Sector at KOLTIVA, stressed that these measures must be inclusive. “Segregation for EUDR compliance shouldn’t come at the cost of smallholder inclusion,” she stated. “That’s why KOLTIVA focuses on building local capacity—from training farmers and dealers to equipping businesses with real-time traceability data. We’re creating systems that are both traceable and inclusive”.

As the deadline nears, businesses face pressure to implement robust systems or risk losing access to the EU market and damaging their reputation. For farmers like Rahman, the stakes are even higher. “We want to protect forests and meet EUDR standards,” he said. “But without clear guidance, even small mistakes can cost us everything. With the right support, we’re ready to do our part—because our future and also the environment depend on it”.