Tesco ups milk payments to farmers
Supermarket giant Tesco hiked the price it pays farmers for milk today as the dairy industry continues to battle rising feeds costs.
The 700 dairy farmers who supply the chain's own-label non-organic milk will be paid up to 31.58p per litre from October 1 - a rise of just over 2p.
The increase leaves Tesco as one of the best-paying of the biggest five supermarket groups.
Promar, an independent consultancy that sets the prices paid to farmers in the Tesco Sustainable Dairy Group, found that as well as feed costs, the poor summer weather lowered the amount of milk produced.
Farmers recently blockaded dairy processors amid proposed cuts in the amount they are paid for milk, claiming they would put many out of business.
Rival supermarket chains Morrisons and the Co-operative Group have since hiked their prices for farmers, but Tesco said today's announcement was the result of a bi-annual review and was not connected to the protests.
The price paid by Tesco includes a 0.5p per litre "supplement" for submitting financial information to Promar. Without this, Tesco's farmers will receive 31.08p per litre.
This compares with 31p at Morrisons and 29.5p at Asda. Farmers supplying Sainsbury's receive 30.56p but this can be boosted if they hit other targets such as improved animal welfare. Farmers with the Co-operative Group currently receive 29p but this will rise to 30p from October 1.
Tesco set up its Sustainable Dairy Group five years ago, guaranteeing to pay more than farmers' production costs and claims to have invested £165 million into paying above average prices to farmers.
Will Hosford, dairy farmer and Tesco farmer committee chairman, said: "This has been a very difficult, wet summer on the farm with uncertain levels and quality of conserved forage on many dairy units, compounded by the huge rise in bought-in feed costs."
Tesco commercial director Andrew Yaxley said: "This increase in the price we pay our 700 dairy farmers means they will continue to benefit from Tesco's pledge to recognise the true cost of production of milk, and always pay a price above that cost."
- 1 Stoke City investigate 'religious abuse' after 'pig's head is found in Kenwyne Jones' locker'
- 2 Gove’s lesson: spare the comma, spoil the child
- 3 You thought Ryanair's attendants had it bad? Wait 'til you hear about their pilots
- 4 Join Ryanair! See the world! But we'll only pay you for nine months a year
- 5 It’s official: thanks to Stephen Hawking's Israel boycott, anti-Semitism is no more
BMF is the UK’s biggest and best loved outdoor fitness classes
Find out what The Independent's resident travel expert has to say about one of the most beautiful small cities in the world
Win anything from gadgets to five-star holidays on our competitions and offers page.
iJobs Money & Business
£550 - £600 per day: Orgtel: Fidessa Analyst / PM - Banking - London - Up to £...
£450 - £500 per day: Orgtel: Sourcing Manager - Banking - London - Up to £500p...
To be discussed at interview.: Queen Elizabeth's School: An experienced and ef...
£294.05 - £330.92 per day + 150 per day travel and accommodation: Orgtel: A le...