UK strikes deal with CO2 firm to restart operations amid food supply fears

The agreement with CF Fertilisers will last for three weeks and is expected to ensure immediate supplies to the food sector remain in place

The UK Government has struck a short term deal with CF Fertilisers to immediately restart operations for carbon dioxide (CO2) production amid food supply fears.

Business and Energy Secretary Kwasi Kwarteng made the announcement to ensure continued supply of CO2 to UK businesses following recent warnings from the meat industry about Britain facing food shortages due to the lack of CO2 gas.

The government is providing limited financial support for operating costs for three weeks for CF Fertilisers to restart operations and produce CO2 at its Billingham plant whilst the CO2 market adapts to global gas prices.

The company produces around 60% of the UK’s CO2, used primarily by the food sector.

CO2 is used to stun animals, such as pigs and chickens, before slaughtering as well as for vacuum-packing meat products and chilling stages of poultry meat production – but it is a by-product of fertiliser production.

Mr Kwarteng said: “This agreement will ensure the many critical industries that rely on a stable supply of CO2 have the resources they require to avoid disruption.

“The quick and decisive action we have taken to resolve the issue shows the seriousness with which we have approached it.

“In our ongoing response to manage the impact of global gas price rises, we will continue to protect businesses and consumers.”

The government held discussions with the main food producers in the UK, their trade bodies and major supermarkets and was reassured about their commitment to move to a sustainable market-based solution by the end of the three-week period.

Tony Will, President and Chief Executive Officer, CF Industries Holdings added: “We want to thank The Honourable Kwasi Kwarteng, Secretary of State for Business, Energy and Industrial Strategy and his entire staff for working tirelessly to bring about this agreement enabling restart of the plant and averting a potential CO2 supply disruption impacting many industries, including food and beverage availability to UK consumers.

“We look forward to working with Secretary Kwarteng and the UK Government on developing a longer term solution, including the development of alternative suppliers of CO2 for the UK market.”

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