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UPDATE 1-Tesco provides 14 mln stg of support to British egg industry

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LONDON, Nov 25 (Reuters) - Tesco, Britain's biggest supermarket group, will provide close to 14 million pounds ($17 million) of additional support to the country's struggling egg industry, it said on Friday.

The UK egg industry is currently in crisis with shortages leading to rationing by major supermarkets including Tesco, Asda and Lidl.

Retailers have blamed the shortages on Britain's largest ever outbreak of Avian flu, which has led to some birds being culled, and on an element of panic buying.

However, producers say the main reason is that they are

not being paid enough

for eggs to take account of soaring feed and energy costs, which has forced some out of the industry, reducing capacity.

Tesco said its commitment to provide a further 13.9 million pounds of support until March 2023 takes its total support to 27.5 million pounds since March this year.

It said the support will be paid to suppliers to cover the cost of handling, processing and egg production, including any increases in feed for farmers.

"Tesco will continue to work with its suppliers to ensure the additional investment gets passed to farmers as quickly as possible," it said in a statement. ($1 = 0.8277 pounds) (Reporting by James Davey; editing by William James)

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