The 700 dairy producers in Tesco’s Sustainable Dairy Group (TSDG) are to receive an extra 1.9p/litre from April 1 2013.
Tesco is lifting its supplier milk price to reflect higher feed costs and lower milk output
The new price of up to 32.77 p/litre is “one of the highest prices paid by any retailer for milk”, claimed the supermarket chain.
Paid to reflect the rising cost of feed and the significant drop in the volume of milk produced during poor weather, the price rise will apply to all own-label fresh milk, except organic milk.
Tesco has also announced a 40 bonus payment for every Aberdeen Angus calf produced by TSDG farmers from their dairy herds, using specially selected sires. The 28 day-aged meat will be sold as part of Tesco’s Finest beef range.
Aberdeen Angus
The payments follow the retailer’s pledge to source all its Finest range beef from the Aberdeen Angus breed.
The 1M investment represents “a significant extra income for TSDG dairy farmers”, it said. The payment will be available for all Aberdeen Angus calves born between January 2014 and January 2015.
John Scouler, Tesco commercial director, said:“This increase in price and our investment in Aberdeen Angus beef not only demonstrates our commitment to British agriculture, but also means we can offer our customers some of the best produce British farmers have to offer.”
‘Dramatic volatility’
Andy Bloor, dairy farmer and Farmer Committee chairman, said:“The Tesco Sustainable Dairy Group was established in 2007 to address the uncertainty faced by dairy farmers caused by the dramatic volatility in the markets, providing much needed stability.
“The Tesco Fair Price Guarantee continues to pay TSDG farmers a milk price that secures confidence and the ability to plan and invest in their business for the future.”
Tesco said it was the only major supermarket to guarantee that its milk was 100% segregated – guaranteeing that every litre of own-brand milk is supplied by a TSDG farmer.
The retailer added that it had invested 165M into the TSDG and in paying above-the-average price to farmers.
Last month, Tesco pledged to "bring meat home" , as part of a promise to buy more British meat.
