Tesco has today reaffirmed its commitment to UK egg farmers as challenging market conditions continue to affect the industry.
The retailer has announced new five-year contracts for all of its five shell egg suppliers – Anglia Free Range Eggs, Glenrath Farms, Griffiths Family Farms, Noble Foods and Skea Eggs. The long-term contracts will mean Tesco continues to stock 100% British shell eggs, while helping to provide UK egg farmers with the confidence to invest and plan for the future.
Tesco has also confirmed the continuation of its industry-leading poultry feed model. Poultry feed represents up to 70% of the cost of production on egg and poultry farms. To tackle fluctuations in prices, Tesco introduced a fair and transparent feed model into its poultry and egg supply chains ten years ago. The model promotes open dialogue between Tesco and its suppliers and adjusts to price changes in the market, providing suppliers with the protection and security they need when buying feed.
Dominic Morrey, Tesco commercial director for fresh, said: “Like many in the food and agriculture industry, we know the egg sector is facing some challenging market conditions with input costs continuing to increase. To provide much-needed support, all of our shell eggs will continue to be produced here in the UK, but we know we need to do more to support our egg farmers.
“That’s why I’m pleased to announce long-term contracts with all our UK shell egg suppliers. Taken together with our well-established feed model, we hope we can provide the industry with some confidence and protection during these uncertain times.”
Tesco and its suppliers are committed to high welfare standards and together are working towards the retailer’s aim of 100% cage free eggs by 2025. It is hoped the new long-term contracts will help achieve the commitment.
Mark Williams, chief executive of the British Egg Industry Council, said: “It is encouraging to see that Tesco is taking a long-term and sustainable approach to its egg supplier relationships at a very challenging time when costs are running so high, while the industry continues to balance its commitment to providing consumers with the highest quality eggs at affordable prices for all. British Lion eggs are an integral part of the nation’s diet, offering a highly nutritious and affordable everyday meal solution, so ensuring British farmers can keep Tesco’s shelves stocked with eggs produced to the British Lion’s world-leading food safety standards, is vital now and for the future.”
The support for UK egg farmers is the latest in a series of measures by Tesco designed to help its UK supply base through the current market conditions. In March this year, it announced a near 20% rise in the price it pays its British dairy farmers for all its fresh milk. Tesco works with a group of 520 British dairy farmers who produce all of its fresh milk. The farmers are paid a fair price which reflects the cost of production.
To help support the British pig sector, the retailer has also announced a £10million enhanced payment plan for its farmers and suppliers, alongside a number of other initiatives, including an increase in the volume of British pork in store.