Tesco announces an increase in the price paid to dairy farmers for their fresh milk
1 July 2016
Tesco has today confirmed that for the three months from 1st August, it will pay its dairy farmers 28.71 ppl for their fresh milk, through the Tesco Sustainable Dairy Group (TSDG). This will be an increase of 0.02ppl from the previous quarter.
The move follows the introduction of the Fair For Farmers Guarantee, which pledges that every pint of milk sold at Tesco is 100% British and provides customers with information on the fair price they pay their dairy farmers.
The Fair For Farmers Guarantee promises that:
- Every farmer is paid fairly for every pint of milk
- Every pint is 100% British
- Every cow is well cared for
Tesco sources all of its fresh milk from over 600 British farmers, who make up the TSDG. Set up in 2007 to address the uncertainty faced by British dairy farmers caused by volatility in the markets, it has continued to be integral to the way the retailer has created fair and sustainable partnerships with producers, growers and farmers across British Agriculture.
Tesco’s Commercial Director for Fresh Food Matt Simister said:
"For almost a decade we have worked with our dairy farmers to provide the best possible quality milk, produced to the highest standards for customers. Through the direct long term partnerships with our producers and the Fair For Farmers Guarantee, shoppers can been confident that every pint of own-brand milk they buy from Tesco, fosters a better future for hundreds of British dairy farmers."
"Because we use an independent price tracker to calculate the current costs of feed and fuel for our farmers every quarter, we are able to reflect the changes in our farmers' real costs so that they are not left disadvantaged."
TSDG Farmer and Committee Chairman James Stephen said:
"Tesco‘s Fair for Farmers Guarantee and their long- term commitment to work with us directly through the TSDG, gives us a level of certainty so that we can plan for the future. This is vital if we want a truly sustainable future for the British dairy industry."
Since its establishment, the pricing mechanism of the groups has ensured that Tesco continues to pay a price for the milk that is buys, that reflects at least the cost of production for dairy farmers. The guaranteed price is reviewed every quarter to ensure that it correctly corresponds with the current market conditions for producers, helps farmers to budget, invest and plan for the future. Calculated by the independent consultancy-Promar - the price paid by Tesco reflects the average cost of production of all members of the sustainable dairy group.
The price, which is always agreed in collaboration with farmers from the group, is completely independent from the retail price for milk. Customers can be assured that every pint of own-brand milk they buy from Tesco supports a TSDG farmer, helping to deliver a sustainable future for the British dairy industry.
The new price covers all Tesco own-brand fresh & filtered milk (1, 2, 4, 6 pint and 1 and 2 litre – excluding organic milk); single, double & extra thick double cream (150, 300, 600 ml) products and mature & extra mature cheddar.