Tesco pushes for greater price stability for its pig farmers

Pig producers supplying Tesco will be paid using a new pricing mechanism, calculated using a combination of industry prices and costs of production on farm.

It is hoped the new pricing system, along with bonus incentives, will give greater stability to producers and encourage further investment in farm businesses.

The UK’s largest supermarket chain has also relaunched its sustainable pig group in partnership with major meat processor, Cranswick.

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Tesco aims to triple the size of the producer group over the next three years and has estimated the group could be worth £670m during this period.

Ashwin Prasad, chief commercial officer at Tesco, said the group would play a vital role by providing forums for collaboration and innovation, as well as driving improvements in quality, animal welfare and the environment.

“Our new cost of production mechanism and bonus incentives will provide real benefits to farmers who will be able to invest in key welfare, sustainability and efficiency improvements.”

Cranswick chief executive Adam Couch added: “Our own farming expertise, long-standing producer relationships, and partnership with Tesco will undoubtedly accelerate sustainable, higher-welfare practices.”

The retailers announcement was also welcomed by the National Pig Association (NPA).

NPA chief executive Lizzie Wilson said: “NPA is supportive of Tesco’s new contract announcement as it demonstrates not only the desire to secure a considerable British supply of pork, but that it requires a long-term retail commitment to ensure pig businesses are sustainable and able to reinvest for the future.

“We particularly note the commitment to supporting indoor producers who want to invest in improving welfare and the sustainability of their farms and hope other retailers follow suit.”

British provenance

Initially, the Sustainable Pig Group will produce all of Tesco’s finest range for fresh pork and there are plans for it to produce all the retailer’s own fresh pork products and sausages over time.

However, this target still looks some way off, with figures from the AHDB’s red meat country of origin audit showing that, in November, only 78% of own-label fresh pork displayed in Tesco stores was British.

Meanwhile, only 34% of own-label bacon and 62% of own-label ham on display were British.

The retailer is working to improve its British offering and has increased volumes of British pork in its sausages, bacon, pork and gammon by 20% during the past 18 months.