Tesco offers two-year contracts to lamb suppliers

Farming leaders have welcomed the news that Tesco has offered two-year contracts to 200 of its lamb suppliers as part of its campaign to increase confidence in its supply chains.

The retailer said the farmers had signed up to direct, two-year contracts with the chain through its processing partner St Merryn, part of the 2 Sisters Food Group. It claimed the deal was the first of its kind from a UK major retailer.

The move was well received by the National Farmers’ Union. Peter Garbutt, chief livestock advisor, said: “It’s an encouraging statement of intent from Tesco that it wants to build longer term relationships with British farmers and invest in sustainable British lamb sourcing.”

Tesco said the contracts also represented a premium over the market price for the lamb, with suppliers forming part of its Sustainable Lamb Group. The product, produced under the Red Tractor scheme, would go into its Finest range.

It said that the 200 farmers were just a start, and the contract offer would be extended to more farmers over the coming months.

Richard Marris, Commercial Director of Fresh Foods at Tesco said: “The uptake of the contracts so far shows that sheep farmers are keen to work with us in building stronger, closer relationships between Tesco and British agriculture. We recognise this is one measure of progress, but we’re excited to be working together with farmers to bring quality, fresh food from British farms to our customers. We hope these contracts will play an important part in giving sheep farmers the confidence they need to invest and plan for the future.”

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