Government urged to intervene as industry faces CO2 crisis

By Michelle Perrett

- Last updated on GMT

The food and drink sector could be facing another CO2 crisis
The food and drink sector could be facing another CO2 crisis

Related tags Supply chain

The Government has been urged to intervene as the UK food and drink sector again faces a crisis with an impending CO2 shortage.

The news comes as CF Industries announced its intention to temporary close its ammonia production at its  Billingham Complex due to “market conditions”​ which it described “uneconomical.​” However, the knock on impact is that CO2, which is a byproduct of the ammonia production process, will stop until the plant is restarted. 

Nick Allen, chief executive of The British Meat Processors Association said: “We knew back in June that the closure of CF Industries’ Cheshire plant would leave UK Co2 supplies vulnerable to anything going wrong with their remaining Billingham plant and that we would be heavily reliant on overseas suppliers to make up the shortfall. Since then, ammonia producers in Italy and Germany have cut production which sent European food and drink companies scrambling to secure tightening supplies of the gas at the end of July.” 

Serious concerns

Allen said that if CF Industries follows through on its threat to close Billingham the British meat industry will have serious concerns. 

“Without sufficient Co2 supplies the UK will potentially face an animal welfare issue with a mounting number of pigs and poultry unable to be sent for processing,”​ he warned. 

“It’s for this reason that securing Co2 supplies is of key strategic importance and, following this latest development, we can’t see how Government can sit on the side lines and insist that it’s for companies to work it out amongst themselves. They are going to need to step in."

Dr Neil Hudson, MP for Penrith and The Border has warned the Government against a looming food security and animal welfare crisis.

“As I’ve said before, food is pivotal to our lives and livelihoods. From Russia’s barbaric invasion of Ukraine to the awfulness of the pandemic, food security has been brought into sharp relief recently and we cannot lose sight of just how damaging this halting in ammonia production could be for our nation’s resilience,” he said. 

“Ultimately, this plant is the only UK producer of fertiliser and carbon dioxide – the loss of which could potentially damage our food and drink sector – with far-reaching implications, much of which not yet foreseen. 

“Also, and very alarmingly, as a vet I’m acutely aware of the impact this could have on our nation’s animal welfare. Carbon dioxide is used in some humane slaughter processes in the pig and poultry sectors. I am asking that the Government acts urgently so that we do not see pigs and birds being unable to be moved off farms, and the drastic negative animal implications that could ensue."

Severe headwinds

The beer sector also expressed concern at the impact. 

Emma McClarkin, chief executive of the British Beer and Pub Association, said: “The timing of this news couldn’t be worse as our pubs and brewers are already dealing with severe headwinds and pressures on their supply chains. This decision raises serious concerns for the sustainable supply of Co2 to the brewing and pub industry."

She added: “A guaranteed supply is essential for operations across pub and brewing businesses and this announcement comes at a time when they are already facing extreme cost rising that are threatening businesses and people’s livelihoods across the country.​ We urge the Government to urgently convene stakeholders to ensure there is a reliable supply of Co2 to our industry and others that depend on it.”

After the last crisis supplies of CO2 for the UK were secureduntil the new year of 2022​, thanks to a deal agreed between Government and supplier CF Fertilisers.

 

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