Tesco will continue to stock 100% British shell eggs after announcing new five-year contracts for egg suppliers as input costs continue to increase.
The contracts are for all of the retailer's shell egg suppliers, including Anglia Free Range Eggs, Glenrath Farms, Griffiths Family Farms, Noble Foods and Skea Eggs.
The move means the supermarket chain will continue to stock 100% British shell eggs at a time when input costs are surging.
Egg producers have been hit by huge hikes in production costs in recent months, pushed even higher by the war in Ukraine.
Figures by ADAS show that feed prices have increased by a staggering 40 percent over the last year.
Energy costs are also at record levels, and this follows on from the UK's worst ever avian influenza outbreak.
The situation is so dire that scores of farms are considering stopping production at the end of their current flock, the British Free Range Egg Producers Association (BFREPA) recently warned.
As part of Tesco's announcement, the retailer also confirmed the continuation of its poultry feed model, as feed represents up to 70% of the cost of production on egg and poultry farms.
The model, introduced ten years ago, promotes dialogue between Tesco and its suppliers to help tackle fluctuations in prices.
Dominic Morrey, Tesco commercial director for fresh, said the egg sector was facing 'some challenging market conditions'.
"To provide much-needed support, all of our shell eggs will continue to be produced here in the UK, but we know we need to do more to support our egg farmers.
“That’s why I’m pleased to announce long-term contracts with all our UK shell egg suppliers," he explained.
"Taken together with our well-established feed model, we hope we can provide the industry with some confidence and protection during these uncertain times.”
Responding, the British Egg Industry Council (BEIC) said it was 'encouraging' to see Tesco taking a 'long-term and sustainable approach' to its egg supplier relationships.
"[It is] a very challenging time when costs are running so high, while the industry continues to balance its commitment to providing consumers with the highest quality eggs at affordable prices for all."
A spokesperson for Anglia Free Range Eggs added that the current economic climate was the most challenging it had ever been.
“Tesco continue to work with us to help navigate these challenges, central to this is the Tesco Feed Model which helps protect producers from the worst of the feed cost inflation.
"This, combined with the longer-term commitments Tesco offer, will also help provide much needed security and stability. “