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Sainsbury’s increases price paid to packers for eggs by 20%

eggs on a tray in a farm

SAINSBURY’S has said it will up the price it pays packers by 20%, following a similar 20% uplift made in June this year.

Richard Crampton, director of fresh food at the retailer, said in a statement, “it was clear” inflationary challenges were impacting the number of free-range eggs farmers could produce.

See also: Why are there egg shortages in supermarkets?

He said the supermarket had announced a 20% increase paid to packers in mid-November, following wide media coverage of egg shortages in all major supermarkets across the UK.

At the same time, Sainsbury’s came under fire from the egg sector for stocking fresh Italian barn egg – a move the British Egg Industry Council’s chairman Andrew Joret described as “very disappointing”.

The British Free Range Egg Producers Association also called for an urgent meeting with Sainsbury’s over the matter. The supermarket has previously committed to only selling British fresh free-range eggs.

Input inflation

The egg sector has been warning since the beginning of the year that farmgate prices are not keeping pace with input inflation.

That has translated to lower confidence and fewer hens brought into production, with the UK laying flock down by 5.5m from its peak in December 2020. It is likely to drop by another 1.3m birds by February ’22.

Announcing the increase in prices, Mr Crampton said: “We have always believed in close collaboration with our farmers and in paying them fairly and, as inflationary pressures rise, we continue to do everything we can to help all our suppliers and communities.

‘Significant challenges’

“We understand that farmers who supply our own-brand egg packers are also facing significant challenges, and it is clear that this is impacting the number of eggs they are able to produce.

“To support them, we have increased the amount we pay our packers for eggs over the past 12 months while at the same time remaining focused on keeping prices low for customers.

“In response to high levels of inflation in June, we accelerated our support, making a meaningful 20% increase in the amount we pay for eggs.

‘Farmer support’

“Last week, we further doubled this investment, paying an additional 20%. This brings the total we have increased pay by over the past 12 months to around 40%.

“While we do not buy eggs from farmers directly, we are working very closely with our own-brand packers to ensure farmers are fully supported with this investment.

“I firmly believe that, right now, prioritising financial support to our farmers is the right thing to do.

“It will ensure they have the confidence and resources to be able to invest in ensuring supply for customers both now and in the future.”