Tesco has risked the wrath of dairy farmers by launching a new range of low-priced semi-skimmed milk.
Fresh’n’Lo, which was the UK’s first branded semi-skimmed milk and has been a fixture in Scottish supermarkets for 30 years, was rolled out into larger Tesco stores in England and Wales this week.
The milk is identical in quality to standard milk, but retails at £1.06 for a two-litre carton, making it 10p cheaper than equivalent products in other multiples.
The appearance of the new line brings to an end a year of price rises that farmers said were essential to keep them in business, and has sparked fears a price war will break out if other retailers follow suit.
Tesco said it had made the move in order to give some respite to shoppers suffering with higher grocery bills. “As customers wrestle with increasing household bills it is important that we help them combat inflation and that is why we are introducing Fresh’n’Lo milk,” said dairy category director David Wood.
However, both the supermarket and Robert Wiseman have been criticised by farmers for potentially destabilising the market and undermining this year’s price increases.
“We’d never support any discounting or destabilising of milk because we’ve been trying so hard to add value to the category,” said NFU acting chief dairy adviser, Hayley Campbell-Gibbons. “If it becomes popular with consumers then less money will go into higher added-value products. If there’s a price war it’s naive to think it won’t hit farmers’ margins.”
However Robert Wiseman insisted the price it was receiving for the milk was sustainable and that its farmer suppliers were happy with the deal.
“This milk is produced by dairy farmers who benefit from one of the best prices in the industry,” said a spokesman. “We are happy to support this cross-national promotion from Tesco.”
Fresh’n’Lo, which was the UK’s first branded semi-skimmed milk and has been a fixture in Scottish supermarkets for 30 years, was rolled out into larger Tesco stores in England and Wales this week.
The milk is identical in quality to standard milk, but retails at £1.06 for a two-litre carton, making it 10p cheaper than equivalent products in other multiples.
The appearance of the new line brings to an end a year of price rises that farmers said were essential to keep them in business, and has sparked fears a price war will break out if other retailers follow suit.
Tesco said it had made the move in order to give some respite to shoppers suffering with higher grocery bills. “As customers wrestle with increasing household bills it is important that we help them combat inflation and that is why we are introducing Fresh’n’Lo milk,” said dairy category director David Wood.
However, both the supermarket and Robert Wiseman have been criticised by farmers for potentially destabilising the market and undermining this year’s price increases.
“We’d never support any discounting or destabilising of milk because we’ve been trying so hard to add value to the category,” said NFU acting chief dairy adviser, Hayley Campbell-Gibbons. “If it becomes popular with consumers then less money will go into higher added-value products. If there’s a price war it’s naive to think it won’t hit farmers’ margins.”
However Robert Wiseman insisted the price it was receiving for the milk was sustainable and that its farmer suppliers were happy with the deal.
“This milk is produced by dairy farmers who benefit from one of the best prices in the industry,” said a spokesman. “We are happy to support this cross-national promotion from Tesco.”
No comments yet