More than 400 British farmers across Tesco’s long-standing sustainable farming groups are set to benefit from additional financial incentives and data collection support to achieve key environmental and animal welfare goals.
From September, 260 UK dairy farmers which make up a significant part of Tesco’s Sustainable Dairy Group (TSDG) and who supply Tesco’s liquid milk through processor Müller UK, will earn up to an extra 2.5p per litre of milk if key targets on emissions reduction, animal health, feed conversion efficiency and genetic improvements are achieved, with the group also taking part in a baselining exercise over the next year to establish targets for soil, water and biodiversity improvements.
Tesco estimates farmers could benefit from more than £9.5m-worth of additional payments in the scheme’s first year. The move comes after Tesco announced the Future Dairy Partnership last year, alongside Müller UK and Arla. The partnership aims to trial new innovations in the sector to reduce emissions, improve animal welfare and protect nature.
Tesco is introducing similar incentive plans for a number of its other sustainable farming groups. Up to 160 farmers in the Tesco Sustainable Lamb Group (TSLG) will benefit from bonus payments for the planting of herbal leys, while Tesco Sustainable Pig Group (TSPG) farmers are set to earn incentive payments across a number of metrics, including animal welfare improvements, biodiversity and soil health, and emissions reduction. The moves follow similar payments for farmers in the Tesco Sustainable Beef Group (TSBG).
The retailer is acting on farmer feedback it collected as part of its Greenprint for UK Farming Report, which set out a number of recommendations for government and the industry to ensure a transition to a low carbon UK agriculture sector. Exploring new payment models and incentives was a key recommendation put forward by farmers.
Ashwin Prasad, Tesco UK CEO, said: “Earlier this year, as part of our farmer-led Greenprint for UK Farming Report, we published a set of recommendations for the government and industry aimed at ensuring the UK agriculture sector is equipped to transition to a low carbon future. A key area identified by farmers was the introduction of incentive schemes to help achieve our shared sustainability goals. We’re pleased to be acting on these recommendations with the roll-out of sustainability-linked incentives for a number of our Sustainable Farming Groups. These incentives will play a crucial role in ensuring our farmers remain economically and environmentally sustainable for the long-term.”
Dave Jones, TSDG chairman and Tesco dairy farmer said: “We welcome the sustainability incentive. The group has continually reduced our carbon footprint over the years, and while this has been recognised, it’s great to now get a payment to reward this and fund future carbon reductions. This should leave us well placed to meet our future industry targets. As farmers and members of the Tesco Sustainable Dairy Group, we have worked on this with Tesco and Müller UK. I believe the template is well balanced to include carbon reduction, improved genetics, feed efficiency, animal health and welfare. and improved biodiversity.”
Rob Hutchison, CEO of Müller Milk & Ingredients, said: “We are delighted to collaborate with Tesco to identify solutions for farmers that will not only drive high standards of animal welfare and reductions in environmental impact, but also create the financial conditions which supports future planning for their business. We want to build a better future for the British dairy sector, and programmes like this, will make a real positive impact.”
