ICE Benchmark Administration Limited (IBA), in collaboration with data solutions company Meridia, has launched the ICE Commodity Traceability Service (CoT), a technology platform designed to maintain the frictionless trade of physical cocoa and coffee by supporting compliance with the European Union’s Deforestation Regulation (EUDR), which is due to come into force at the end of next year.
Europe is the largest market for cocoa and coffee worldwide. As this publication has previously reported, while no country or commodity will be banned, companies will only be allowed to sell products in the EU if the supplier of the product has issued a so-called ‘due diligence’ statement confirming that the product does not come from deforested land or has led to forest degradation, including of irreplaceable primary forests, after 31 December 2020.
ICE CoT aims to automate the process of submitting, storing, and validating the information necessary for cocoa and coffee operators and traders to ensure and demonstrate compliance of their products with the regulation. It is aimed at supporting all commercial trade affected by the EUDR.
“Meridia has proven expertise in the risk assessment and verification of farm origin and supply chain data, and its methodologies and technology will be embedded within ICE CoT to provide robust validation for farm and traceability data provided by cocoa and coffee traders and operators,” said Clive de Ruig, President of IBA.
“Customers can register and validate parcels of beans and products in ICE CoT, which can be maintained and tracked as they are traded, divided, and processed along the supply chain.
“ICE CoT will provide continuous and independent validation of the traceability data from the initial parcel to its ultimate use or export, giving confidence to operators and traders of the quality and compliance of the data underlying the product.”
Key players
About ICE
ICE (Intercontinental Exchange) provides the largest markets in the world to trade cocoa and coffee through its benchmark Cocoa, London Cocoa, Coffee and Robusta Coffee futures and options markets. Last year the equivalent of over 500 million tonne s traded on ICE’s cocoa and coffee markets.
About ICE Benchmark Administration
ICE Benchmark Administration is authorized and regulated by the Financial Conduct Authority for the regulated activity of administering a benchmark, and is authorized as a benchmark administrator under the UK Benchmarks Regulation. Operating ICE CoT is not a regulated activity.
About Meridia
Meridia is an agricultural technology company specializing in high-quality field data solutions for smallholder-heavy supply chains in various (tropical) commodities. It is committed to promoting fair and sustainable practices to make farmers visible in supply chains and help them market their goods to global markets.
The IBA said it anticipates launching ICE CoT in 2024, in advance of the regulation entering into an application for operators and traders on December 30, 2024. It remains subject to further testing, system and data availability, and any regulatory contingencies.
“ICE’s objective to ensure that cocoa and coffee remain easily tradable is closely aligned with Meridia’s mission to deliver services that ensure the future of sustainable smallholder supply chains, for whom continued frictionless access to EU markets is so critical,” said Thomas Vaassen, CEO of Meridia. “ICE CoT is an excellent example of how our expertise in farm origin and supply chain data verification can be used to support all stakeholders in complex supply chains.”
