Tesco agrees £25m deal with beef and pork farmers
Thursday 08 November 2012
Tesco has announced a £25 million annual deal with beef and pork farmers, promising them better prices and longer contracts.
The supermarket giant - which has previously attracted criticism from farming groups for its prices and short contracts - said the move is designed to take the pressure off British suppliers following rising feed prices.
The arrangement will create two new groups run by committees of farmers and will guarantee an above-market price for beef suppliers and pork prices linked to the cost of feed.
Tesco said the "industry first" will give direct contracts lasting up to 36 months to members of the groups, giving livestock farmers more security, the ability to plan ahead and a guaranteed fair price for their meat.
The retailer will work with around 140 pig farmers who will supply the retailer with the majority of its own brand fresh pork, with prices for meat reviewed on a monthly basis taking feed into account.
Around 1,000 beef farmers will supply Tesco with all its Finest brand beef.
Asked if the deal would mean higher prices for consumers, a Tesco spokeswoman said: "There will definitely be no costs passed on to customers from the groups themselves."
NFU president Peter Kendall welcomed the announcement, saying: "Tesco's desire to establish a dedicated relationship with producers matched with a long term direct contractual commitment should be praised.
"We believe that these arrangements will foster stronger relationships with the farmers involved and ensure that Tesco is able to provide a consistent product for consumers."
Tesco's meat, fish and poultry director, Derek Lawlor, said: "As British agriculture's biggest customer, we're delighted to be announcing this new way of working with British beef and pig farmers.
"Pig farmers have been under pressure with significant rises in feed prices so it means a great deal to work in partnership with them and British beef farmers to help secure the industry's future in this country.
"Not only will our customers enjoy even more high quality, high welfare British meat in our stores, the Tesco Sustainable Farming Groups, like our pioneering dairy group before them, will guarantee farmers a fair price for their meat and allow them to invest and plan for the future."
Environment Secretary Owen Paterson said: "Farmers and retailers will thrive when they work together for the future of the whole industry. This is an excellent scheme which will give more certainty to beef and pork producers.
"Freeing up businesses from unnecessary burdens and getting them the right support will lead to a stronger UK production sector, which will allow British farmers to take advantage of the huge opportunities to supply markets at home and all over the world."
National Pig Association (NPA) chairman Richard Longthorp said: "The NPA applauds Tesco for developing its sustainable pig group and working directly with pig farmers. Creating this direct relationship with its pig farmers will bring an unprecedented level of transparency to the pricing of pigs and pork from farm to fork.
"This transparency and the direct linking of pig price to increasingly volatile costs of production should bring benefits to the whole chain through fairer sharing of risk and reward. It will also mean that Tesco will be able to secure its supply of high welfare, independently audited, British pork for its customers in the face of otherwise reducing supplies."
- 1 Forget 'The Dress': Here are five of the biggest news stories you might have missed
- 2 The black and blue dress: Makers considering a white and gold version
- 3 PornHub turns masturbation into energy in bid to save the planet
- 4 The remarkable archaeological underwater discovery that could open up a new chapter in the study of European and British prehistory
- 5 Saudi Muslim cleric claims the Earth is 'stationary' and the sun rotates around it
British are sexually uptight, dirty and drink too much – according to Spanish book
PornHub turns masturbation into energy in bid to save the planet
Ukraine crisis: Top Chinese diplomat backs Putin and says West should 'abandon zero-sum mentality'
White and gold or blue and black – what colour is the dress? An eyewitness gives a definitive answer
Saudi Muslim cleric claims the Earth is 'stationary' and the sun rotates around it
New theory could prove how life began and disprove God
Half of Ukip voters say they are prejudiced against people of other races
This is what it's like to be dead, according to a guy who died for a bit
'Cash for access' scandal: Sir Malcolm Rifkind says 'unrealistic' for MPs to live on £67,000 salary
'Jihadi John': CAGE representative storms off Sky News accusing Kay Burley of Islamophobia
Ukip would cut billions from Scottish budget to fund English tax cuts
iJobs Money & Business
£40000 - £50000 per annum + pro rata: SThree: SThree Group have been well esta...
£30000 - £37000 per annum: Recruitment Genius: Established in 1999, a highly r...
£250-£300 Day Rate: Jemma Gent: Are you a qualified accountant with strong exp...
£230 - £260 Day Rate: Jemma Gent: Do you want to stamp your footprint in histo...