The Impacts of the EU Deforestation Regulation on Businesses in Thailand: Challenges and Opportunities

The European Union Deforestation Regulation (EUDR) was adopted in 2023 to reduce deforestation and forest degradation linked to global trade in forest risk commodities, including cattle, cocoa, coffee, oil palm, rubber, soya, and wood. Under the regulation, operators and traders must exercise due diligence—comprising information collection, risk assessment, and mitigation—to ensure that commodities placed on the EU market are legally produced and deforestation-free. However, concerns remain regarding how developing-country exporters, particularly small and medium-sized enterprises (SMEs), can comply with these requirements given financial, technological, and institutional constraints. This study examines the differentiated impacts of the EUDR on Thai businesses by firm size through a mixed-method approach integrating literature review, business surveys, expert interviews, and case studies of Sri Trang Agro-Industry (STA) and Thai Eastern Group Holdings (TEGH). The findings reveal that large enterprises leverage digital traceability platforms, polygon-based mapping, and smallholder training to transform compliance into a competitive advantage, while SMEs face significant challenges due to fragmented supply chains and limited digital infrastructure. The study concludes that without targeted policy support and inclusive governance, the EUDR may unintentionally reinforce trade inequality. It proposes coordinated interventions by the Thai government, the European Union, and private industry to ensure that deforestation-free trade advances both sustainability and equitable participation.