Batches, deliveries and the practical implementation of DDS in the EUDR

Executive Summary

With the EUDR, new, binding due diligence obligations will apply from the end of 2025 for companies that market or export products containing high-risk raw materials such as wood, cocoa, coffee, soy, palm oil, beef or rubber in the EU. A due diligence statement ( DDS ) must be drawn up for each of these products. This declaration always refers to a clearly defined product batch - not to individual deliveries - and must prove that the product is deforestation-free and can be fully traced back to the parcel of origin. To this end, companies must set up their own due diligence system that covers the entire supply chain - from the origin of the raw material to the finished product. The key requirements are the clear identification of batches, the precise recording of all relevant data and complete documentation of origin, quantity, transportation, processing and storage. The physical delivery is merely a logical consequence of the documented batch.

Challenges arise in particular in the case of collective warehouses, mixtures, repackaging and multiple deliveries. In such cases, each new mixture or sub-batch must be provided with its own, transparently documented DDS. Subsequent merging of different batches of origin is not permitted. Reference numbers, barcodes and digital systems such as ERP or track & trace solutions are crucial to ensure an overview of the flow of goods and to document them in accordance with the law. Missing or incorrect documentation can lead to sanctions, market bans and reputational damage. A clear allocation of EUDR batches, the consistent use of references, well-structured warehouse processes and the training of all departments involved are key success factors for the implementation of EUDR. The aim is a transparent, deforestation-free supply chain with traceable products - from origin to consumer.

What is the Due Diligence Statement (DDS) and why is it so important?

Overview of the DDS obligations of the EUDR

The DDS (Due Diligence Statement) is at the heart of the EU regulation to combat global deforestation, which has been in force since mid-2023. Manufacturers and traders who deal with high-risk raw materials such as wood, cocoa, coffee, rubber, palm oil, beef or soy - i.e. who import, process or export these raw materials - are directly affected. They are obliged to set up their own due diligence system in which they assess, document and actively minimize potential risks along their supply chain. The decisive factor here is not only the introduction of this system, but also proof that it is actually being applied effectively. This due diligence system must cover all stages of the supply chain - from the growing area or parcel of origin to the finished product placed on the EU market. Companies must ensure that all relevant information on origin, transportation, processing and storage is recorded completely, correctly and comprehensibly. This includes geographical information, delivery quantities, transformation processes within the company and the identity of all actors involved.

The most important requirements are The entire supply chain of a product must be fully traceable. Companies must check exactly where their raw materials come from and whether these origins are associated with a risk of deforestation or forest degradation. The final step is to submit a due diligence declaration (DDS) for each defined batch - a formal document that proves that the legal requirements have been met and that there is no risk of deforestation. This document becomes the basis for import or sales approval within the EU.

DDS goal: No deforestation via products in the EU

With the due diligence obligation, the European Union wants to prevent products from being imported or exported that are associated with deforestation or the destruction of forests. The EUDR due diligence declaration is the central link between the documented supply flows and the risk-oriented rejection or approval by the authorities. This not only protects consumers, but also creates new requirements and responsibilities for trade, industry and the entire upstream value chain.

Importance of documentation for all parties involved in the supply chain

The scope of the verification and documentation obligations extends to everyone involved in the supply chain. Without complete documentation on the place of origin, quantity, delivery route and transformation processes in the company, there is not only the threat of sanctions, but also the loss of market participation in the EU. Practical experience shows that around 80% of companies with relevant raw material use report difficulties with traceability and collecting information on origin, as studies by industry associations confirm. It is clear that a strong and well-functioning DDS infrastructure is very important - not only for compliance with regulations, but also for a sustainable and future-proof orientation of the company.

DDS and the reference to batch and delivery - how is this regulated?

Information and definitions for practical use

For the successful and smooth implementation of the EUDR, it is important to clarify key terms used in the course of this directive. A key term in this context is "batch". This term refers to a defined quantity of a product that has been manufactured, processed or obtained under the same or comparable conditions. It is important to emphasize that each batch must be clearly identifiable. This is done by linking it to all relevant data and evidence, which includes information on the origin of the product and its traceability, for example. This evidence is not only important for internal processes, but also plays a key role in communication with external partners and supervisory authorities.

In contrast, the term "delivery" describes the actual transportation of goods or the physical handover of products to the next player in the supply chain. This process is often linked to a delivery bill, which contains all the necessary information about the type and quantity of goods delivered. In addition, the entire process is documented in the ERP system to ensure a complete overview of outgoing and incoming goods. It is important to understand that a batch can consist of several deliveries; at the same time, a single delivery process can comprise several batches.

Despite this flexible handling, it remains crucial for the obligations under the DDS that each individual batch is correctly allocated. This means that companies must record exactly how their products were manufactured and delivered. This is the only way they can meet the requirements of the EUDR. Careful documentation and clear handling of batches and deliveries not only help to comply with legal requirements. They also improve processes in the company as a whole. The clear separation and unambiguous assignment of these terms is essential in order to identify potential risks at an early stage and take appropriate risk mitigation measures. A good understanding of these terms helps companies to better fulfill their legal obligations. It also enables them to make their supply chain more efficient in the long term.

Basic rule of the regulation: DDS refers to the batch, not to the delivery

The core requirement of the EUDR-DDS is clear: the duty of care and therefore also the DDS relates exclusively to the batch. This means that market participants must collect and document all necessary information and evidence relating to a precisely defined product batch. In DDS practice, deliveries are merely an expression of the physical movement of goods; they are logically based on the underlying batch.

A practical example: An importer imports 20 tons of cocoa into the EU. This quantity constitutes a batch for which all origin data, inspection reports and risk assessments must be recorded. Whether the 20 tons are shipped all at once, in several or in partial deliveries is irrelevant for the due diligence declaration obligation. The decisive factor is the clearly defined batch - the documentation and due diligence obligations relate to this, not to each individual delivery.

Relevance for reference numbers and product labeling

Well-maintained and clearly assigned reference numbers are essential for a stringent DDS system. Linking batch and delivery numbers enables the flow of goods to be traced at any time - both from a compliance perspective and for any recalls or spot checks that may be required in practice. Batch designations and numbers must be consistently recorded on delivery documents, invoices and in internal merchandise management and updated or updated at every delivery and processing step. Modern ERP solutions and specialized traceability tools offer automated workflows that generate batch numbers from source data, store them securely and add them as a reference for each delivery. Uniform marking of products - for example with barcodes or RFID tags - ensures greater legal certainty. At the same time, it reduces the amount of work involved in internal controls, audits or inspections by authorities.

How do you deal with collective batches and stock items?

Problem: Lack of separation or mixing in the warehouse

In practice, companies are often faced with a variety of organizational and technical challenges that can arise in the storage of products and raw materials. In particular, when goods are stored as collective batches or in bulk in silos, tanks or storage boxes, the problem of mixing different batches of goods often arises. This becomes particularly critical when it comes to removing partial quantities whose exact traceability to their origin is no longer guaranteed.

A classic example of this is grain import processes in which different harvests from different regions are mixed. Cross-contamination can also easily occur during the storage of oilseeds or bulk products. If the individual batches are not clearly separated from each other, companies can find it difficult to trace the origin and specific quantity of each batch. The challenge is particularly evident given the strict regulations and requirements of the EUDR.

However, the EUDR has very clear requirements: Even in situations where physical separation in the warehouse is difficult to implement, a clear allocation of the quantities and origins of each batch must be ensured. This means a significant effort for companies, as they have to implement both technical and organizational measures. These measures should not only ensure that the mixing of different DDS-relevant batches is reliably prevented, but also that complete documentation is available in the event of mixing.

To overcome these challenges, the implementation of modern technologies such as automated warehouse management systems could be considered. Such systems not only provide a more accurate record of item movements and stock levels, but also enable improved traceability through digital evidence. It is also important to train warehouse staff in the use of these systems and develop clear internal processes to ensure legal compliance.

In summary, companies are required to take proactive steps to comply with the necessary standards for the traceability of their products. With targeted measures and suitable technologies, companies can reduce legal risks. At the same time, they strengthen the trust of their customers and secure their market position in the long term.

Do separate DDS documents have to be created for each batch?

The regulation clearly requires a separate declaration of due diligence to be drawn up for each individual batch. This means that a blanket declaration of due diligence for the entire batch is not sufficient, even in the case of collective storage or the mixing of partial quantities. Instead, each batch must remain clearly identifiable and its origin must be traceable. If material with different origins or different risk profiles is mixed, a separate, summarized due diligence declaration must be created for each new batch. The parcels of origin and the respective proportions must always be disclosed. A classic example is the blending of coffee from several regions: The retailer must - depending on storage practice - create a new "blend" as a separate batch with its own DDS documents and document the proportions of the original parcels of origin. Subsequent merging of different due diligence declarations is not permitted under EUDR regulations.

Possibilities of implementation in practice

Various implementation options are widely used to avoid errors or bottlenecks. Many companies use digital merchandise management and track & trace systems that automatically check whether each withdrawal, delivery or reworking is assigned to a batch. In larger agricultural businesses or commodity traders, color and storage zone concepts, barcode scans and differentiated storage areas are also in use. At an operational level, every company should define internal work instructions that regulate how to proceed when combining, portioning or repackaging DDS-relevant material. In practice, there are often mixed approaches. Certain mixtures are managed as separate sub-batches as long as it is clearly documented where the individual components come from. Regular internal audits and training of the responsible employees are crucial in order to implement the due diligence obligations effectively and as error-free as possible.

Special cases and common pitfalls

Different suppliers for the same products

A particularly challenging situation arises when a company purchases the same types of goods from different suppliers - such as soybeans from several sources. In such cases, the EUDR stipulates that each purchase must be documented as a separate, batch-specific due diligence declaration. The temptation to declare similar products from different sources as a joint batch is great for reasons of process simplification. However, this is not legally permissible, as each supplier, each parcel of origin and each batch must be clearly documented and recorded separately. This also applies if mixing takes place later in the warehouse. The company is obliged to ensure consistent transparency for every incoming goods posting and for subsequent physical deliveries.

Repackaging or order picking in the warehouse

In logistics practice, deliveries are often repacked or picked for individual customers. This raises the question of how the DDS documentation should be kept if the flow of goods no longer corresponds to the original batch. It is crucial that the reference to the original batch is retained in the documentation even after repackaging or partial removal. Each newly assembled product bundle must continue to be clearly traceable. Particularly when trading raw materials in secondary packaging, such as small retail packs, the DDS information must also be kept at individual level. Many companies use serialized labels or digital links (e.g. via QR codes) that lead back to the main DDS number of the underlying batch.

Practical example: Loose stored material with individual delivery

An illustrative example from everyday life: A retailer stores rubber in several silos, each from different regions of origin with separate due diligence declarations. Depending on customer requirements, the rubber is also delivered to the processing industry in partial quantities or mixtures. For each partial quantity, the company must record exactly how much it contains and which batch of origin it belongs to. It must also ensure that no unauthorized mixing takes place - unless the batch is reassessed and documented beforehand. If several batches are poured together, a new, clean DDS must be created for the "consolidated batch". Life cycle audits and the use of modern IoT technology, for example for weighing and fill level monitoring, help to ensure accuracy and compliance, especially with high throughput and complex storage processes.

Recommendations for action in practice

Establishment of a structured recording of batch and delivery data

The most important basis for a smooth and legally compliant EUDR implementation is the establishment of a structured system for recording all batch and delivery-relevant data. Companies should analyze existing processes at an early stage, identify bottlenecks in the data flow and close gaps in warehouse or production logistics. Digital goods management and traceability systems offer a way of automatically linking all incoming goods, internal stock transfers and deliveries with the associated due diligence declarations. It is also advisable to integrate third-party systems - such as those of external logistics partners or suppliers - into your own database at an early stage in order to avoid media discontinuities in batch tracking.

Use of reference numbers as a central control element

The consistent use of reference numbers (batch number, DDS reference, origin number) not only increases transparency, but is also a central control element in the context of the EUDR-DDS. Every movement of goods, every storage event and every processing operation should be documented with these references - from goods receipt to internal processing to delivery to the end customer. Modern ERP systems enable these reference numbers to be automatically generated, maintained and forwarded to downstream systems. Specialist departments such as IT, logistics and quality management should work closely together to ensure data consistency and legibility, even with complex product ranges and multi-level supply chains.

Training and involvement of relevant departments

The due diligence obligations have a deep impact on several areas of the company, from procurement, production and warehousing to sales and the legal department. Early and continuous training of all employees who come into contact with the processes is crucial. Only those who understand the logical link between batch, delivery and due diligence declaration can avoid process errors, unauthorized mix-ups or gaps in the documentation. Practical training courses based on typical company processes, regular "incoming goods inspections" through internal audit series and a central contact person who answers questions and coordinates training courses are helpful. A comprehensively trained workforce is a decisive competitive advantage, particularly with regard to inspection visits by authorities or external inspection bodies.

Conclusion and outlook

The clear insight from the EUDR obligations: The DDS is always related to the batch, the physical delivery only acts as a subsequent event. The clean separation and documentation of batches is therefore the backbone of EUDR compliance. Companies that implement this consistently avoid serious risks and create a solid foundation for sustainable, future-proof supply chains. Only complete, tamper-proof and transparent documentation of all batches and associated deliveries can minimize the risk of compliance violations. The EUDR, with its strict due diligence requirements, does involve a lot of effort. However, the benefits - such as legal certainty, greater customer trust and sustainable positioning - pay off in the end. In times of increasing market surveillance and social responsibility, this is indispensable.

Companies that would like to take a closer look at the implementation of the EUDR - for example, the technical implementation of batch tracing or the establishment of internal processes - should read the EU Commission's official guidelines. Expert forums and industry-specific recommendations from the respective associations also offer valuable support.