Carbon dioxide producers have struck a deal to ensure UK businesses have a secure supply of CO2 after food industry bodies warned of shortages.
The country’s biggest producer of CO2, CF Fertilisers – responsible for 60% of UK supply – reached agreement with industrial customers just as a previous deal to ensure supplies ran out.
The deal will enable CF Fertilisers’ Billingham plant to continue to operate while global natural gas prices remain high.
It means key sectors including the food and drink sector are guaranteed secure supplies of CO2, which is used for the humane killing of livestock, carbonating drinks and keeping produce fresh during transit.
A spokesperson from CF Industries told Supply Management the deal will mean its Billingham site will “remain operational and continue to sell CO2 on a contractual and spot basis”.
The Department of Business, Energy and Industrial Strategy said: “The government welcomes industry’s agreement which is in the best interests of businesses.
“In the longer term, the government would like to see the market take measures to improve resilience, and we are engaging on ways this could happen.”
No further details regarding the deal have been released.
Kate Halliwell, chief scientific officer at the FDF told the BBC: “UK food and drink manufacturers welcome the deal that will ensure continuity of CO2 supply, keeping our shops, pubs and restaurants stocked with our favourite food and drink.”
The deal comes after trade bodies from the food and drink industry warned further disruptions to CO2 supplies could result in food shortages and add to inflationary pressures.
A previous deal to fix the price of CO2 for CF Industries for three months came to an end on 31 January.
The UK government also stepped in and committed tens of millions of pounds to cover the cost of natural gas for three weeks at CF Industries in September, after the company had announced it was temporarily suspending production as soaring energy prices made CO2 production untenable.
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