The food and beverages industry warns of a price hike and shortages in goods such as packaged meat and fizzy drinks as the British government ended its subsidies to the carbon dioxide industry yesterday (31.01.2022).
The Department for Business, Energy & Industrial Strategy (BEIS) arranged a deal in October 2021 with companies using CO2 in food and drinks production, which was due to end after three months.
The deal was made after a rise in gas prices forced the US company CF Industries to close two of their sites in September 2021, one in Teeside and the other in Cheshire, which both had been producing 60% of the UK’s carbon dioxide supplies.
The BEIS has now said that the CO2 industry must find a new alternative to these subsidies and collaborate to address the issue.
Between January and September 2021, gas prices increased by 250%.
Chief Scientific Officer at the Food and Drink Federation, Kate Halliwell, said that while the Government’s support last year was appreciated, with energy still being very expensive, carbon dioxide shortages would be inevitable.
“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.“, Halliwell said.
“We will continue to work with the Government on this. It is critical that together we ensure supply can continue and that we build long-term resilience into the production of food-grade CO2.“
CO2 is used for many aspects of food production including in fertilisers, to stun animals before slaughter, for carbonated and alcoholic drinks, to create dry ice to preserve the shelf life of some products during transportation, and also in packaged goods like cheese and meats.
Chief Executive of the British Meat Processors Association, Nick Allen, said on BBC Radio 4’s Today programme on 28 January 2022 that the meat industry had been told supplies of carbon dioxide would be prioritised for abattoirs to ensure meat processors and animal welfare was not badly affected. No other sectors of the food industry were mentioned.