A report from the Ministry of Agriculture and Environment (MAE) puts Vietnam’s
exports of agriculture, forestry, and fisheries products to the EU in 2025 at $9.24
billion, accounting for 13.2 per cent of the sector’s total export value.

Coffee posted the strongest growth among export items, with shipments exceeding
666,000 tons and export value reaching $3.63 billion, up 68.3 per cent in value.
The EU accounted for 40.7 per cent of Vietnam’s total coffee export value, maintaining
its position as the country’s largest export market for coffee. Notably, coffee
exports to key markets such as Germany, Italy, Spain, and the Netherlands all posted
impressive growth.

Rising standards

The European Union Deforestation Regulation (EUDR) is increasingly seen as
a driver for Vietnam’s agriculture and forestry sectors to accelerate digital transformation,
standardize data, and strengthen governance. Meeting EU standards not only helps
overcome trade barriers but also creates favorable momentum for Vietnamese products
to access other high-end markets more easily.

Exports of Vietnam’s agricultural and forestry products to the EU are expected
to continue growing in the years to come. However, Dr. To Xuan Phuc, an expert at
non-profit Forest Trends, said this growth trend is no longer simply about expanding
market share but is accompanied by increasing pressure for comprehensive transformation
in governance, transparency, and sustainable development.

Where businesses previously focused mainly on complying with domestic laws
and basic trade regulations, they must now meet a broader set of criteria, including
preventing deforestation, reducing carbon emissions, respecting the rights of indigenous
communities, and ensuring equality and meaningful participation of smallholder farmers
in supply chains. International trade, particularly in the EU, is shifting from
price-based competition to standards-based competition.

According to Dr. Phuc, the EU-Vietnam Free Trade Agreement (EUVFTA) has created
significant advantages for Vietnamese goods, as tariffs on many agricultural and
wooden products have been reduced to zero, strengthening their competitiveness compared
with countries that do not have trade agreements with the EU. However, as tariff
barriers are gradually removed, technical barriers and compliance costs are becoming
increasingly significant.

The EU is now widely viewed as a complex legal system with multiple overlapping
regulations, including the EUDR, the EU Timber Regulation (EUTR), and the Registration,
Evaluation, Authorization and Restriction of Chemicals (REACH) regulation. Among
these, the EUDR is considered to have the most far-reaching impact on Vietnam’s
coffee, rubber, timber, and wooden product sectors. In May 2025, the EU classified
Vietnam as a “low-risk country” under the EUDR, meaning inspection rates of around
1 per cent and significantly simplified control procedures.

Traceability challenges

Mr. Truong Tat Do, an official from the Forestry and Forest Protection Department
at the MAE, said there remains a misconception that Vietnamese companies must directly
submit reports under the EUDR.

In reality, the legal obligation rests with importers in the EU. However, for
partners to fulfill their due diligence responsibilities, Vietnamese businesses
must provide complete and accurate information on product origin to EU importers.
This means that although domestic companies do not directly submit documentation,
they still face significant pressure to ensure transparency and the reliability
of their data.

The EUDR sets out two core requirements. First, products must not be linked
to deforestation or forest degradation after December 31, 2020. Second, production
must comply with national laws, including regulations on land, environment, labor,
and the rights of third parties. The regulation does not apply only to production
areas but to the entire supply chain, from harvesting and transport to processing
and export. If any stage involves legal violations or deforestation after the stated
cut-off date, the product will not meet requirements.

Under the latest timeline, the EUDR will take effect on December 30, 2026,
for large companies in the EU and on June 30, 2027 for small and medium-sized enterprises
(SMEs). The preparation period is therefore limited, while the transformation required
is both systemic and long term.

Dr. Phuc said Vietnam’s biggest challenge lies in the fragmented and small-scale
nature of production. A farmer may own multiple plots of land, while raw materials
can pass through six to seven intermediary layers before reaching processing factories.
This structure makes traceability extremely complex, particularly when precise geolocation
data must be provided for each shipment.

Another issue is the overlap of forestry land. In some localities, such as
Son La in the north and parts of the central highlands, rising coffee prices led
to expansion into areas designated as forestry land. Under Vietnamese law, some
of these cases may not be fully compliant, while under the EUDR the risk of products
failing to qualify for export is clear.

“Before discussing global standards, the most important requirement is compliance
with Vietnamese law,” Dr. Phuc said. “There are still areas recorded as forestry
land on paper where forests no longer exist in reality, and some forest allocation
contracts from earlier programs remain legally valid, creating complications in
management and accountability. If these issues are not addressed in a coordinated
manner, adapting to the EUDR will face significant obstacles.”

Digital mapping

A major shift under the regulation is the requirement for geospatial data.
Companies must provide precise geographic coordinates of production plots, and a
closed polygon boundary must also be defined for areas of 4 ha or more. EU authorities
will cross-check this data with satellite mapping systems as of December 31, 2020,
to assess deforestation risks. This approach shows that the EUDR no longer relies
solely on paper documentation but increasingly uses remote sensing technology and
digital data for monitoring. Inaccurate or dishonest declarations can be quickly
detected when compared with independent systems.

Mr. Pham Ngoc Hai, a remote sensing expert at the Forest Inventory and Planning
Institute, said advances in remote sensing and digital transformation are fundamentally
changing how information on forests and land use is accessed. Free satellite imagery
from the US’s Landsat program has provided continuous data since 1972. While it
previously took 16 days to obtain a new image, observation frequency is now significantly
higher, enabling near-continuous monitoring.

“Just two or three overlapping satellite images can significantly improve observation
capacity,” Mr. Hai said. “Observations generate data, and data produces information
that objectively reflects conditions on the ground. For a specific forest plot,
it is possible to trace land use history from the 1980s to the present, effectively
‘telling the story’ of how that area has
changed over time.”

In practice, field inspections may show that an area has been planted with
coffee, but it can be difficult to determine exactly when the crop was established.
Satellite data allows analysts to trace backwards in time to determine whether the
planting occurred before or after the 2020 cut-off date, and whether the land was
previously farmland or forestry land. This capability helps clarify timing, a key
factor under the EUDR.

According to Mr. Hai, Western partners do not necessarily require Vietnam to
provide every piece of detailed information, as they can retrieve data from independent
sources. Exporters only need to provide the coordinates of shipments, while importers
can independently verify and cross-check the information. Multiple traceability
systems are currently in use; beyond domestic platforms, international partners
may build their own databases and compare data from various sources. There is no
longer a single source of information.

In this context, data transparency has become essential. If reports differ
between stages, external parties can verify the information using scientific data
with a high degree of accuracy. Technology and data are reshaping how natural resources
are managed and are setting higher transparency standards for the entire supply
chain.

To help
Vietnam’s agricultural and forestry products deepen their access to the EU market,
experts recommend that during the 2025-2027 period the country should prioritize
completing GPS mapping of raw material areas, building comprehensive traceability
records, and strengthening data governance capacity.