Tesco butters up stores with Irish produce

Tesco stores in Poland, the Czech Republic, Slovakia, and Hungary will stock Irish packet butter as part of the chain’s new €20m supply contract with the Irish Dairy Board.

During the remainder of 2012 and throughout 2013, the Tesco outlets will sell Irish butter under the company’s own brand label. The average growth of dairy consumption across these four markets is 5.1% versus the EU average of 1%.

Poland is the fourth biggest butter market in the EU. Combined, these four markets consume 22 times the amount of butter consumed in Ireland. This announcement represents a significant advancement for the Irish dairy industry in these key markets.

Tesco Ireland chief executive Tony Keohane said: “With over €700m worth of Irish food exported to Tesco internationally, including 13% of all dairy exports, today’s announcement reaffirms Tesco as a very significant buyer of Irish food.

“We are continuing to explore new export opportunities for Irish products from established exporters and emerging SMEs.”

The announcement is the latest in a series of market developments for the IDB, which is responsible for just under €1bn worth of dairy product exports from Ireland annually.

IDB chief executive Kevin Lane said: “This announcement represents a key new route to market for the IDB as we prepare for the expansion of milk volumes ahead of the removal of milk quotas in 2015. This partnership with Tesco will help us on our journey to ensure that we meet our international export and growth objectives and feeds into our strategy of significantly growing new sales into new geographies and markets.

“We’re confident that this exciting new growth initiative with Tesco can be built on further in the years to come.”

Agriculture Minister Simon Coveney described the contract as a successful milestone for the agri-food sector as part of expansion envisaged in Food Harvest 2020, the agri-food sector’s blueprint for expansion.

Mr Coveney said: “It’s heartening to see this sector announce positive news stories as it continues to achieve real growth despite a volatile global environment.

“Developing new routes to market is a crucial component of our strategy under Food Harvest 2020, and I congratulate the IDB and Tesco on their ongoing commitment to the roles they play in working to achieve our country’s export growth potential.”