There could be a shortage of beer and fizzy drinks in the US as supplies of carbon dioxide from ethanol plants run low, according to a new analysis.

The Renewable Fuels Association (RFA) says US ethanol sales in 2020 could fall by more than $10 billion (£8bn) as a result of the global coronavirus lockdown and the resulting collapse in biofuel consumption.

The RFA has warned economic damage will ‘go far beyond the ethanol sector’ and warns America’s farmers will also be negatively impacted, as ethanol typically provides a market for two out of every five rows of corn and more than one-third of the annual sorghum crop, used for the production of alcoholic beverages.

Meanwhile, it says the industry supports 350,000 jobs and contributes valuable co-products like distillers grains, corn distillers oil and captured carbon dioxide to the food supply chain – brewers and soft drink manufacturers use carbon dioxide for carbonation, making drinks fizzy.

Geoff Cooper, RFA President and CEO, said: “This sobering new analysis underscores the magnitude of the economic devastation being suffered in the ethanol industry.

“Roughly half of the ethanol industry is shut down today, as fuel demand has collapsed in response to Covid-19 and it is clear we have a long and bumpy road to recovery ahead of us. Corn demand and prices have plummeted as plants have idled, jobs are being lost, and rural communities are being destabilised.”