Renewed fears CO2 crisis could fuel supply shortages
CO2 is used in many areas of hospitality: it makes the fizz for soft drinks and some beers, stuns animals before slaughter, and helps extend the shelf life of food.
The Government’s deal with major CO2 producer CF Industries, which began in October when high gas prices threatened food supplies, will end today (31 January).
Continued concern
British Institute of Innkeeping chief executive Steve Alton commented: “After two years of closures and disruptions and with prices rising significantly across the board in food and drink, utilities and staffing, our members’ businesses are incredibly fragile.
"The latest challenge presented by the shortage of CO2 will place further pressure on their supply chains and their ability to operate effectively. As we have seen over the course of the pandemic, pub operators are resilient and resourceful, but they need support across all areas of their businesses to enable them to recover and rebuild.
“They now need the certainty of ongoing business support particularly with an extension of lower VAT for pubs, suspension of crippling business rates and a rapid introduction of a significant reduction in duty for beer served in pubs".
Food and Drink Federation chief scientific officer Kate Halliwell said the security of food-grade CO2 supplies in the UK has concerned the industry for some time. She said: “Last year’s Government intervention, which guaranteed CF Industries production of CO2 until the end of this month was very welcome.
“But we are concerned that with just days now remaining before that agreement comes to an end, and energy prices still very high, there will be further CO2 shortages once again”
This could lead to shortages in the products we find on our supermarket shelves, adding further pressures to families already coping with high food-price inflation, she said.
A spokesperson for the Food and Drink Federation told the BBC the association would continue to work with the Government on the issue, as it was “critical” to ensure CO2 supply continued, and that a long-term resilience into the production of food-grade CO2 was built.
Worse than 2018
Last year, CF Industries was subsidised by the Government after temporarily closing its facilities in Billingham and Cheshire. Following this, the company agreed to continue CO2 production until the end of this month (January).
Whilst they were shut, supermarkets began reporting limited stocks on food items, while the pig industry warned that farmers would have to cull their stocks if slaughterhouses could not process animals.
In September, the British Beer & Pub Association reassured that there would not be a beer drought. The Society of Independent Brewers stated shortages wouldn’t impact cask beer immediately, but would be a worry for key, bottled and canned beer.
This comes after reports from last year suggest pubs could face a CO2 shortage worse than 2018.
A Heineken UK spokesperson said: “Over the last three years we’ve taken a number of steps to improve the resilience of our operations and minimise the risk of disruption from CO2 shortages. This has included investing £5 million in a CO2 recovery plant for Hereford, so we have recovery plants at both our Hereford and Manchester production sites, alongside robust contracts to safeguard our supply. Currently the supply of CO2 to Heineken UK remains unaffected and we are monitoring the situation".
