Tesco boost for UK dairy industry
Tesco has announced two new measures to help raise the price UK dairy farmers receive for their milk.
Tesco said it would offer direct contracts to around 850 farmers, raising the price farmers receive to around 22p per litre, the best price currently being paid by any supermarket.
“The new contract prices will be reviewed every six months to make sure they reflect the farmers’ costs of production and will be determined using key variables such as feed, fertilizer, energy and labour,” Tesco said in a statement.
However, shoppers will pay no more for that milk than they do now, the company added.
The firm is also launching a new “localchoice” milk, which will be sourced from local farms and sold at Tesco stores in or close to their county.
It will sell for slightly more per litre than standard milk meaning these smaller producers can make returns more in line with the proportionately higher costs of their business, according to Tesco. The National Farmers’ Union (NFU) has welcomed Tesco’s announcement.Tesco’s commercial and trading director Richard Brasher said: “We know that some British milk producers – often through no fault of their own – have had a very difficult time for a number of years.
“We can all debate the causes – the abolition of guaranteed pricing, CAP reform and structural factors in the market – but the fact remains that the industry has found it very tough for a long time now.
“I believe that this new package of measures offers British farmers a great opportunity to work with us, get closer to consumers and grow their business.”
Tesco is the largest single retailer of milk in the UK.
