Carbon dioxide (CO2) prices could skyrocket by 500% in Britain, the government warned its food producers on Wednesday, after extending emergency state support in order to avert a food shortage.
The warning comes as surging gas prices in Europe have sent shockwaves through industries reliant on natural gas, forcing some fertilizer plants to shut down in recent weeks.
Fertilizer production is a major source of industrial CO2. As plants convert natural gas into fertilizer, they produce CO2 as a byproduct for industrial use. Carbon dioxide is used in several ways in food production, including to stun animals, as an alternative refrigerant, to cool meat and other foods during processing, and to replace oxygen in modified-atmosphere packaging. Slaughterhouses in the UK depend heavily on CO2.
As the situation with CO2 worsened, London struck a deal with US company CF Industries to restart production at two closed plants.
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“We need the market to adjust, the food industry knows there’s going to be a sharp rise in the cost of carbon dioxide,” Environment Secretary George Eustice told Sky News, adding that the price of CO2 would rise sharply, from £200 ($272) a ton to around £1,000 ($1,365).
According to the official, the three-week support from CF, which supplies some 60% of Britain’s CO2, would cost “many millions, possibly tens of millions, but it’s to underpin some of those fixed costs.”
While the government and Prime Minister Boris Johnson have repeatedly denied concerns that there could be a shortage of traditional Christmas fare such as turkey, some say the temporary deal to supply carbon dioxide would not solve the food industry’s problems.
“A three-week deal won’t save Christmas,” Richard Walker, managing director for supermarket Iceland, told Reuters. “And certainly, won’t resolve the issue in the long term – we need a permanent solution to keep the wheels turning for fresh food supplies.”
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Secretary Eustice says, “We know that if we did not act, then by this weekend or certainly by the early part of next week, some of the poultry processing plants would need to close.”
“And then we would have animal welfare issues, because you’d have lots of chickens on farms that couldn’t be slaughtered on time, and would have to be probably euthanized on farms, we’d have a similar situation with pigs.”
Meanwhile, according to the Nippon Gases corporation, “other countries in Europe will also suffer shortages” of CO2, as their supplies have tumbled 50% across the region.
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