Tesco Becomes First Retailer To Introduce New Long Term Contracts For Potato Growers

Tesco announced yesterday it will issue contracts worth £12m over three years to help support British Agriculture. The retailer claimed that it will become the first retailer in the UK to introduce new long term contracts for potato growers and packers, a move it said was aimed at helping to safeguard the future of UK farmers who supply the supermarket.

Through the Tesco Sustainable Farming Group – Potatoes (TSFG-Potatoes) scheme, Tesco said that growers will benefit from greater financial certainty. The TSFG-Potatoes will be made up of a collection of producers and industry experts, and will aim to build stronger relationships through the whole supply chain.

Matt Simister, Tesco’s Commercial Director for Fresh Food, said: “Working collaboratively with our suppliers to ensure we provide the highest quality fresh produce for our customers is right at the heart of what we do. Whilst there isn’t a single simple solution to resolve the uncertainty faced by many potato growers, it’s important that we all play our part. These new contracts will help to bring more confidence back into the whole potato supply chain and build a truly sustainable British potato industry.”

Under the new scheme, from September, producers will be given direct contracts with Tesco and a three year rolling commitment which will guarantee in advance, the volume of the crop that the supermarket will buy. The retailer added that TSFG growers will also receive a price based on their production costs, which will take into account inflation, farming inputs like the cost of fertiliser and the additional expenses involved in growing high quality fresh produce for customers.

NFU Horticulture and Potatoes Adviser, Lee Abbey, commented: “The NFU welcomes initiatives that provide a greater level of security, confidence and transparency to growers and we’re pleased that Tesco has followed through its commitment, first announced at the NFU conference in 2014, to develop a dedicated potato contract.

“The Tesco Sustainable Farming Group is a great example of how collaboration can work and it fits very much within the principles of the NFU’s Fruit and Veg Pledge. We hope growers are able to benefit from this new approach.”