Tesco has reaffirmed its commitment to UK egg farmers, even 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. Tesco said the long-term contracts will mean it will continue 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 10 years ago, which promotes open dialogue between Tesco and its suppliers and adjusts to price changes in the market.
Tesco and its suppliers are also 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.
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 … 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.”
Mark Williams, Chief Executive of the British Egg Industry Council, added: “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.”
NAM Implications:
- A welcome move that promises stability for the Tesco producers.
- A pointer for others?
- If not, what then?
