Lidl has announced new financial incentives for farmers to get into egg production following a challenging year for the sector.
The discounter said it would take a 'bold new approach' to boosting UK egg production after pressures such as bird flu, surging costs and low prices.
Existing and new farmers will be offered an additional investment of £40m on top of market rates, supported by long term contracts as part of a guaranteed pay back deal.
Through these contracts, Lidl said producers would be given 'security and confidence' to invest in and expand their existing businesses, helping to provide greater returns in the long term.
Whilst some supermarkets in recent months have chosen to import eggs from oversees, Lidl said it had 'held firm' on its pledge to source 100% British fresh shell eggs.
Martin Kottbauer, chief trading officer at Lidl GB, said the retailer industry should be doing more to ensure the long-term sustainability of the egg sector.
“We have taken steps to offer incentives and security for farmers to expand into egg production," he explained.
"This approach, which is supported by long term contracts, is giving our suppliers confidence to invest in their businesses and further secure their futures. We would urge other retailers to do the same.”
Earlier this year, the government pledged to review supply chain fairness in the egg sector in light of the impact of numerous challenges.
It followed continuous industry campaigning for a fairer deal for free range egg farmers against the backdrop of rocketing costs.
Many farms had seen energy bills increase by tens of thousands of pounds, while feed costs had risen by 50% or more.
Mr Kottbauer said the last year had been particularly challenging for the British egg industry, adding that it’s had "an impact on everyone".
"The easy option would certainly have been for us to source elsewhere, but we are firmly committed to the long-standing relationships we have with our suppliers."