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Green.earth outlines the EU deforestation regulation, which will apply from the second half of 2023 and covers seven commodities worth €85 billion in trade. Companies must trace goods to the plots where they were produced.
The article notes that compliance costs and the need for alternative suppliers will likely raise prices for commodities destined for the EU.
Reduced compliant supply for EU buyers should lift prices of palm oil and soy destined for Europe and add a premium to certified product. The effect on broader feed markets depends on how much trade is diverted.
green.earthMar 22, 2023After 548 past bullish policy events, Palm Oil moved a median +0.4% over 5 sessions (61% higher; middle half -0.7% to +2.1%), and +0.9% over 20.
After 356 past bullish policy events, Soybeans moved a median +0.1% over 5 sessions (53% higher; middle half -1.2% to +2.3%), and -0.9% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
