THEMATIC SESSION ON traceability requirements for bulk
agricultural commodities

25 march 2025, 15:00-16:30

Moderator's Report[1]

At the Tenth Triennial Review, Members agreed to continue to hold thematic sessions in conjunction with the TBT Committee's regular meetings from 2025 to 2027 to further deepen the exchange of experiences on specific topics. On this basis, the Committee agreed to hold a thematic session on traceability requirements for bulk agricultural commodities.^[2] Information about the speakers, presentations, and related materials is available on the WTO website.^[3]

1  introductory remarks by the moderator

1.1.  As economies increasingly subject agricultural products to various sustainability standards and regulations, traceability systems are becoming an important tool to demonstrate conformity with such requirements across their entire life cycle.

1.2.  Over the years, Members have been notifying to the TBT Committee various traceability systems, including those related to sustainability requirements. Examples range from farm-to- market traceability requirements for organic products; traceability requirements within the cocoa supply chain for sustainably produced cocoa; and traceability requirements to manage various risks triggered by livestock feed (including risks to the environment).

1.3.  WTO Members have also raised and discussed specific trade concerns (STCs) related to different traceability requirements in the TBT Committee. These discussions touched upon uncertainties regarding the implementation of traceability requirements, complexity of traceability schemes and cost-, time- and administrative-related burdens for complying with such requirements.

2  Guiding questions

·_        Why is ensuring sustainability of agriculture commodities important? What impacts and opportunities does this present?

·_        What are the key challenges (and possible solutions) Members, in particular developing ones as well as medium-sized enterprises, face for:

o_   [as importers] developing traceability schemes for bulk agriculture commodities and, ultimately, determining whether relevant sustainability requirements in standards and technical regulations are fulfilled?

o_   [as exporters] complying with such traceability schemes and, ultimately, demonstrating whether such sustainability requirements are fulfilled?

·_        What best practices and strategies could Members use to guide the development of traceability schemes and support transparency and information sharing?

·_        What is the role of international standards in ensuring interoperability between such traceability schemes?

·_        How can the TBT Agreement disciplines as well as the TBT Committee discussions and guidance contribute to this issue?

·_        Environment and sustainability being cross-cutting global issues, ensuring coherence and promoting complementarity both inside (across different WTO bodies) as well as outside the WTO (e.g. across other international organizations and bodies) is important. What are the challenges and solutions to address this goal?

3  Interventions

3.1  Round one

3.1.  In the first round of interventions, speakers were invited to address the key challenges — particularly for developing Members and medium-sized enterprises — in developing traceability schemes for bulk agricultural commodities, and determining compliance with sustainability requirements. Speakers were also asked to share best practices and strategies to support the development of such schemes and enhance transparency.

3.2.  Ms Rosalind Leeck (United States)[4] emphasized the inherent complexity of traceability in bulk commodity supply chains. She noted that the US soybean supply chain is quite complicated and involves over 500,000 farmers and 10,000 first points of purchase, leading to significant commingling of products before export. This makes it difficult to establish a traceability system without compromising efficiency or significantly increasing costs. In this context, Ms Leeck stressed the importance of clearly identifying the problem that traceability systems are meant to address, and ensuring that such measures deliver measurable value without creating unnecessary burdens and costs.

3.3.  Mr Jasveer Singh (Australia)[5] echoed Ms Leeck's comments regarding the complexity of bulk commodity supply chains and the importance of clearly understanding the outcomes that traceability systems aim to achieve. He noted that the costs and challenges of digitalizing supply chains might not be proportionate to benefits this could bring. In addition, Mr Singh said that if traceability systems are implemented without fully understanding the operational realities of complex food systems, there is a risk of undermining the underlying sustainability objectives. He recommended a measured and systems-based approach across complex supply chains to better understand how production systems operate and what are the most efficient ways to collect data for complying with traceability requirements.

3.4.  Ms Marcela Gaviria Botero (Colombia)[6] presented Colombia's experience in complying with traceability schemes in the coffee sector. She noted that 96% of coffee growers in Colombia operate on less than a five-hectare plots, making a traceability in the coffee sector particularly challenging. In this context, Ms Botero highlighted Colombia's longstanding investment in institutional capacity and digital systems through the Federation of Coffee Growers and its investigation center, Cenicafé. These institutions help Colombian coffee growers and exports to successfully comply with sustainability regulations in export markets through their work with foreign regulators and organizations and maintaining information systems with useful data for compliance.

3.5.  More broadly, she noted that the major problem for complying with the traceability schemes is the lack of data which tends to be the result of geographical dispersion, poor physical and digital infrastructure, insufficient governmental support and the lack of resources.

3.2  Round two

3.6.  Ms Rosalind Leeck discussed the differences between various systems as well as benefits that can be achieved from traceability. Ms Leeck presented four main traceability systems – "book and claim", "mass balance", "segregation", and "identity preservation" – each with distinct implications for cost, effectiveness, and usability. In particular: (i) the book and claim system does not always allow to demonstrate the sustainability of traded commodities in the supply chain; (ii) the mass balance system implies commingling of compliant and non-compliant products; (iii) the segregation system implies excluding non-compliant materials from the value chain; and (iv) the identity preservation system, the most costly and complicated scheme, provides the end-user with assurance that a product is fully traceable and maintained its unique identity from farm to end-use. In this context, she noted that with time, traceability systems become more complicated, especially in markets where consumers ask more questions about the way agricultural products are produced. In some instances, such schemes are able to provide added value for all participants in the supply chain in terms of transparency. It is nevertheless important to ensure that such traceability requirements are outcome-based and are not overly burdensome so that agricultural products remain available and affordable and producers (especially small businesses) are not excluded from the supply chains.

3.7.  Ms Leeck also noted that the United States has a well-developed national data and systems that help industries to meet different traceability requirements around the world, including by working with regulators in export markets. It is nevertheless necessary to constantly benchmark domestic requirements against the patchwork of different traceability schemes in other countries. In this context, she noted that proliferation of different traceability requirements creates a costly and challenging environment.

3.8.  Mr Jasveer Singh presented Australia's national agricultural traceability strategy which outlines the plan to enhance traceability systems in biosecurity, food safety and trade. The strategy was co-designed with industry, governments, and other supply chain stakeholders to have a common vision and shared objectives across agricultural production sectors. Mr Singh noted that the strategy's objectives include tracking and tracing capabilities; aligning regulatory management frameworks; sustaining and promoting market access; supporting an automated interoperable and digital system; supporting producers to meet new and emerging market access requirements and strengthening national and international collaboration on traceability. The strategy also has an implementation plan that outlines concrete steps to achieve these objectives. He also said that the industry leadership is central to the traceability strategy, with government playing a supporting role.

3.9.  Mr Singh noted that several agricultural traceability projects were announced to support the implementation of the strategy and the development of efficient and sustainable traceability systems. These initiatives will help Australian industry to: (i) credibly demonstrate claims in markets by aligning commercial and regulatory systems with international standards and best practises; (ii) identify ways to reduce compliance time and costs by allowing data capture and reuse; and (iii) enhance trust by evolving the robust traceability systems and investigate how to prevent the proliferation of standards that could create confusion, duplication and inconsistency in already complex agricultural and food systems.

3.10.  Ms Marcela Gaviria Botero discussed sustainability certifications, "responsibly sourced" initiatives as well as Colombia's strategy in this area. She noted that Colombia's coffee producers tend to comply with sustainability certification requirements (such as Rainforest Alliance, Fair Trade, AAA and CAFÉ practices) which allow them to sell their products at premium prices. The emerging traceability schemes however create new challenges for producers which include the lack of information (such as geolocation data or deforestation analysis), and significant investment needs to comply with such requirements. Some of the Colombia's strategies to address such challenges include the use of national data systems as well as reliance on sustainability certification schemes. In this context, she noted that sustainability certification schemes try to account for new traceability systems in different markets by introducing the respective requirements.

3.11.  In terms of "responsibly sourced" initiatives, she noted that while such measures provide consumers with useful information to make informed choices, they create significant financial burdens for coffee growers and do not result in premium prices for their products.

3.12.  She also presented the work of Colombia's National Federation of Coffee Growers. She explained that the Federation helps coffee exporters to ensure they comply with the requirements in the export markets and do not bear extra costs in this process. In particular, the Federation works with foreign regulators to help them better understand the local context of supply chains as well as to receive more clarity regarding the traceability requirements in export markets. Other useful tools to support coffee exporters include: (i) the Coffee Information System (SICA), a database with geolocation information of coffee growers; and (i) collecting information on establishment dates of coffee plots.

3.3  Round three

3.13.  In the third round of interventions, speakers discussed how the TBT Agreement disciplines, and the discussions and guidance of the TBT Committee, can contribute to the effective development and implementation of traceability schemes for bulk agricultural commodities.

3.14.  Ms Rosalind Leeck highlighted the importance of the transparency framework under the TBT Agreement and noted that the US Soybean Export Council heavily relies on the notifications submitted to the TBT Committee as well as other WTO bodies. When Members do not notify traceability requirements to the WTO, relevant stakeholders are deprived of an opportunity to have a multilateral discussion to learn from each other and identify the least trade-restrictive traceability schemes. Ms Leeck noted that the dialogue enabled by the TBT transparency framework could eventually alleviate a burden on many different stakeholders within the supply chains while still making it possible to achieve the goals of underlying regulations.

3.15.  Ms Marcela Gaviria Botero echoed some of the points raised by Ms Leeck and stressed the importance of having a multilateral and multistakeholder dialogue on traceability schemes for bulk agricultural commodities. She noted that such discussions would help to better understand the context in each country (e.g., the structure of production or supply chains), challenges for complying with traceability requirements and maintaining market access for producers of commodities.

3.16.  Mr Jasveer Singh acknowledged the difficulties of designing traceability schemes that are non-discriminatory, proportionate and account for different local contexts. In this context, he pointed out to the need to reinforce collaborative and rules-based approach for designing and implementing such traceability requirements.

4  COMMENT BY THE MODERATOR

4.1.  I would like to thank the Secretariat and the Chair for the invitation to moderate this thematic session. This session benefitted from having a smaller number of speakers (from Australia, Colombia and the United States) and more time for discussion.

4.2.  The purpose of our thematic session was to share best practices and lessons learned and challenges in developing and implementing traceability schemes to demonstrate conformity to sustainability requirements. Discussions underscored the importance of both implementing and developing traceability schemes as equally relevant elements. Speakers emphasized that the TBT Agreement provides a framework to help regulators across the world in developing traceability requirements which are outcome-based and practical.

·_        As economies increasingly subject agricultural products to various sustainability standards and regulations, traceability systems are becoming an important tool to demonstrate conformity with such requirements across the product's life cycle.

·_        Traceability requirements, however, can sometimes be unnecessarily complex and burdensome which can restrict market access or add unnecessary cost to the supply chain, especially for small businesses and developing Members. According to some estimates from our speakers, traceability requirements can result in 10-50% increase in the price of commodities.

·_        Speakers outlined four key traceability models – book and claim, mass balance, segregation, and identity preserved – each with distinct implications for cost, effectiveness, and usability.

·_        We discussed a number of challenges in complying with such traceability schemes including the lack of information and the complexity of supply chains. Developing Members' challenges also include insufficient resources and support to navigate and comply with various traceability requirements across markets.

·_        Public-private collaborations and national-level strategies were highlighted among the tools for facilitating compliance and implementation of traceability schemes. We also heard about how some Members support their industries in navigating and complying with various sustainability requirements and related traceability schemes by ensuring the availability of data for compliance.

·_        We discussed the need for increased dialogue and cooperation, including at the international level, to ensure market access and avoid unnecessarily burdensome requirements for bulk agricultural commodities. In this sense, speakers also highlighted the importance of guaranteeing that traceability scheme requirements are outcomes-based and pragmatic.

·_        Speakers also highlighted the importance of the TBT Agreement disciplines and TBT Committee guidance for designing and implementing effective traceability schemes. For instance, speakers pointed out that the TBT Agreement transparency disciplines enable early dialogue between various stakeholders to better understand supply chain and find the least burdensome way of implementing traceability schemes. Speakers also referred to the obligation to avoid unnecessary obstacles to international trade, which is crucial for ensuring the proper balance between the government's right to address various sustainability objectives and the need to avoid regulatory measures that are more trade restrictive than necessary to attain those objectives.

4.3.  I would like to thank all speakers for their thought-provoking contributions and Members (both in room and online) for their active engagement. I hope this session was helpful for all Members, and I personally learned a lot from our speakers.

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