By Brian Zweifel, DNR Forest Products Specialist

Understanding The EUDR And Impacts On The U.S. Forest Products Sector

For those who haven’t been keeping up with international policy, the European Union Deforestation Regulation (EUDR) is an environmental policy proposed to ensure that products sold within the EU do not contribute to global deforestation or forest degradation. The regulation targets seven key commodities—cattle, cocoa, coffee, palm oil, rubber, soy, and wood—that are major drivers of deforestation for agricultural expansion. While the goals of the EUDR are widely supported by environmental and industry groups, its original compliance requirements created significant, and potentially insurmountable, challenges for the U.S. hardwood industry. This article explains the critical updates and delays announced in late 2025, details the proactive solutions being developed by industry groups like the American Hardwood Export Council (AHEC) and American Hardwood Assured (AHA), and outlines a clear path forward for forest products companies. These recent developments have shifted the compliance conversation from crisis to a more manageable, strategic response.

Key EUDR Amendments And Delays

Following extensive negotiations in late 2025, the EU agreed to delay the EUDR’s primary enforcement date by an additional 12 months, pushing the deadline for large operators to December 30, 2026—a full two years after the original date. This extension provides a crucial window for industries to adapt.

Alongside the timeline extension, two important administrative changes were agreed upon in December 2025, which significantly reduce the bureaucratic burden on the timber industry in the EU importing forest products:

• Elimination of Downstream Reference Numbers: The original requirement to forward reference numbers throughout the entire EU supply chain has been removed. This complex process would have created immense administrative costs, possibly leading to reduced demand for U.S. hardwood imports. Now, scrutiny will be focused on the point where products first enter the EU market, not on every transaction that follows within the EU.
• Simplification for EU Internal Trade: The obligation to submit due diligence statements now falls only on the businesses that first place products on the EU market. This means downstream traders and operators within the EU are no longer required to submit their own statements for those same products, streamlining internal commerce.

However, these procedural reliefs within the EU did nothing to resolve the core structural challenge of data collection and reporting at the origin of the U.S. supply chain.

The Issue Of Geolocation In The U.S. Hardwood Supply Chain

The single biggest compliance challenge for the U.S. hardwood sector remains the requirement to provide precise geolocation data for every single parcel of land where timber is harvested. In the U.S., this means reporting all the way down to the tax parcel. This adds to the complexity of reporting because the “average” property often contains multiple tax parcels. For the U.S. industry, meeting this demand on a parcel-by-parcel basis is considered “practically impossible” due to the unique structure of its supply chain.

Key reasons for this challenge include:

• Fragmented Ownership: The U.S. hardwood supply is sourced from millions of privately-owned forests, along with federal, state, county, and tribal ownerships. A single export shipment could contain wood aggregated from hundreds or, in some cases, even thousands of individual properties, making parcel-level tracking an enormous undertaking.
• Complex Aggregation: To create commercially viable export consignments, U.S. exporters must aggregate wood from numerous harvest locations. The hardwood supply chain is not designed to segregate and track wood from individual small properties through mills and to the final container.
• Lack of Standardized Permitting: Unlike in many other countries, private forest owners in different regions of the U.S. have varying requirements for government permits for harvesting. Because regulations vary by state and municipality, there is no standard set of “documents” that can be collected to verify the origin and legality of every log.

This fundamental disconnect between the EUDR’s demands and the realities of the U.S. forest products supply chain required the industry to develop a response.

The AHEC And AHA Path Forward

To address this challenge, the American Hardwood Export Council (AHEC) and American Hardwood Assured (AHA) are developing a comprehensive system to demonstrate EUDR compliance in a way that is workable for the U.S. supply chain.

The Legal Argument: Jurisdictional Risk Assessment

The foundation of the U.S. industry’s approach is a compelling legal argument. AHA maintains that for a low-risk country like the United States, a statewide risk assessment constitutes “adequately conclusive and verifiable information” and should be accepted in place of individual harvest site documents. This approach is not merely a request for convenience; it is presented as necessary to avoid conflict with the EU’s laws on proportionality, privacy and the right to conduct business.

• Defining “Negligible Risk”: The AHA Platform aligns with the EUDR’s definition of “negligible risk.” This standard does not need to prove zero risk to be met, but rather by demonstrating that illegal actions are “isolated and irregular occurrences and are therefore not systematic or systemwide.” Extensive assessments show that illegal logging, while a concern for individual landowners, is extremely rare and contributes less than 1% of the total wood supply to U.S. hardwood mills. Based on this verifiable information, the products show “no cause for concern,” and the risk is therefore negligible.

AHEC’s Four-Part Framework Solution

To support this legal argument with robust data, AHEC is building a sophisticated, four-part technical framework:

1. Geolocation Database: AHEC is commissioning a database using satellite imagery and AI to monitor U.S. hardwood forests. Crucially, this system is designed to differentiate between land disturbances that could be considered deforestation and common sustainable harvesting practices that do not lead to deforestation, thereby providing quantifiable, “deforestation-free” risk data.
2. Online Accessibility: An online application is being developed to make this data freely and easily accessible to U.S. hardwood mills and exporters, allowing them to pull the necessary compliance information. This high-resolution system is being developed by the private sector in part because the EU’s own “EU Observatory” provides remote sensing data of such low resolution that it is inadequate for compliance purposes. Hardwood exporters in the U.S. can also use the AHA platform and tools for free through at least 2027, thanks to funding from the U.S. Department of Agriculture and AHEC member support.
3. Independent Risk Assessments: AHEC commissioned third-party risk assessments from Dovetail Partners for 37 hardwood-producing states, including Wisconsin. These reports verify the negligible risk of illegal harvesting and are conducted according to a standardized framework. To ensure maximum credibility, each completed assessment is subject to additional scrutiny by an independent expert before publication.
4. Chain of Custody (CoC) Standard: A CoC standard is being developed for mills, distributors, and exporters. This final piece will ensure that the “deforestation-free” claim is applied correctly and exclusively to verified U.S. hardwood as it moves through the supply chain.

This framework is not just a proposal; its components are actively being piloted and developed now, connecting the industry’s legal position to a solution that is data-driven and practical.

What This Means For Industry In 2026

The recent developments create a clear path forward. The delay to late 2026 is a critical window of opportunity for the U.S. hardwood industry to solidify its compliance solution and present a unified front to EU regulators.

• Build a Unified Case: The industry’s core strategy is to achieve widespread adoption of the AHA Platform now. By demonstrating that the U.S. industry has a workable, widely adopted system in place well before the 2026 deadline, it builds a much stronger case for its formal acceptance by the European Commission.
• Leverage the Simplification Review: The EU is mandated to conduct a “simplification” review of the EUDR by April 30, 2026. This review presents a critical opportunity for the U.S. industry to lobby for the formal recognition of its jurisdictional, state-based risk assessment approach as a valid compliance method.
• Communicate with Confidence: U.S. exporters should reassure their European buyers that a sophisticated system is actively being built. They can communicate with confidence that by the December 2026 deadline, they will be able to provide the necessary documentation to demonstrate the legal and deforestation-free origin of their products.

Conclusion: A Challenging But Manageable Future

The EU Deforestation Regulation presents significant compliance hurdles for global supply chains, and the U.S. hardwood industry is no exception. However, the recent amendments delaying implementation and simplifying bureaucracy, combined with the proactive solutions being developed by AHEC and AHA, have created a clear and manageable path forward. By leveraging jurisdictional risk assessments and advanced data systems, the industry is poised to meet the EU’s environmental goals without disrupting the unique and sustainable structure of the American hardwood supply chain.