Fair For Farmers Guarantee
Tesco Milk - Fair For Farmers
At Tesco we are committed to selling high quality milk, sourced from British dairy farmers who benefit from our long-term support and are guaranteed a fair price for every pint.
Since 2007, we have worked directly with 600 dairy farmers, with herds ranging from 60 to 1,800 cows, who supply us with fresh milk. In return, we pay guaranteed prices and agree long term contracts, through the Tesco Sustainable Dairy Group (TSDG). This year that number will rise to around 800 – the largest group of dairy farmers working directly with a retailer.
All of our milk is 100% British, from cows who receive great care and attention.
Increases in EU milk production following the removal of the European milk quota system and global changes (including decreasing demand from China and a Russian ban on European imports) has caused a worldwide surplus and falling wholesale milk prices.
The TSDG is one of the long term ways Tesco continues to provide support and security to British dairy farmers during periods of economic uncertainty.
While prices may fluctuate in shops, we pay farmers a market leading price, set for three months at a time, ensuring they have a stable income, no matter what happens in the market. Since November 2007, in total we have paid £240m over market prices to our milk farmers*.
It’s also the way we partner with British dairy farmers to help ensure the best quality milk for shoppers, whilst ensuring cows on these farms are well cared for, clean and healthy.
With the ‘Fair For Farmers Guarantee’ now on each Tesco milk bottle, customers can be confident when they buy any Tesco standard fresh milk (not including fresh organic and Channel Island milk), they are helping to foster a better future for hundreds of British dairy farmers. In 2018, we also extended the guarantee to suppliers on a selected range of pouring creams (Single, Double, Extra thick and ‘Creamfields’).
What is the Fair For Farmers Guarantee?
- Every farmer is paid fairly for every pint of milk
Tesco dairy farmers get a fair deal, with a price above the cost of production for their fresh milk, so even if we drop the price of milk for customers, our farmers get paid the same.
- Every pint is 100% British
We work with dairy farmers from across England, Scotland and Wales.
- Every cow is well cared for
We have some of the best and award-winning farmers across the country, whose priority is the health and well-being of their cows. Shoppers can be confident that our milk is produced to high standards and with great care and attention.
All Tesco dairy farmers receiving our Guarantee must adhere to the nationally recognised Red Tractor assurance scheme, as well as additional Tesco welfare standards on cow health and welfare.
What is a fair price?
The cost of feed, fuel and fertiliser changes regularly, so we work with an independent agricultural consultancy to collate our farmers’ costs to make sure the price continues to reflect the group’s production costs.
Prices are agreed with our farmers and set for three months ensuring they have a stable income, no matter what happens in the volatile market.
This allows dairy farmers to invest in equipment, modern animal welfare technologies and innovate for a truly sustainable approach.
We have been commended by The National Farmers Union (NFU), Government Ministers and MPs for our long-term commitment to support the British dairy industry.
How else does Tesco support the British dairy industry?
We run the Tesco Dairy Centre of Excellence in partnership with Liverpool University. It offers a valuable teaching and research resource at a working farm for Tesco farmers, veterinary surgeons and students sharing expertise and knowledge with farming colleagues from across the country, in order to improve animal welfare and encourage innovation.
For new farmers wishing to enter the dairy industry we offer a 12 month package of training, business planning, advice and supply chain experience through our Future Farmer Foundation.
Following the success of the Tesco Sustainable Dairy Group, in April 2016 we launched a £6 million two year investment to help support dairy farmers who supply us with milk for our cheese. A new cheese group will guarantee an above market price for the milk produced for Tesco’s British own-label Mild, Medium, Mature, Extra Mature, Red Leicester and Double Gloucester cheese.
Tesco dairy farmers also have access to a joint initiative with Anglia Farmers - the ProducerClub. The club delivers support for the day-to-day running of farms and an unrivalled combination of savings and benefits.
*£240 million is calculated by taking the total amount we’ve paid to our farmers compared to the AHDB average market price per litre each month (whether higher or lower), multiplied by the number of litres we purchased that month.