British food industry to be hit by five fold increase in CO2 prices
The government has announced that the British food industry faces a “sharp rise” in the cost of CO2, a crucial component of food and drink production.
Gas prices have surged forcing UK fertiliser plants to shut in recent weeks, leading to a shortage of CO2 used to make drinks and beer fizzy and to stun farm animals before slaughter. As a result, the UK’s Environment, Farming and Rural Affairs minister today warned the British food industry that CO2 prices will rise five fold.
“We need the market to adjust. The food industry know there’s going to be a sharp rise in the price of Carbon dioxide probably going from something like £200 per tonne eventually up closer to something like £1,000 per tonne, so a big, sharp rise,” said George Eustice during a Sky News interview, calling CO2 “a small,” but “critical component” of production.
The news comes after the British government yesterday struck a deal with the US company CF Industry, which supplies some 60 per cent of Britain’s CO2, to restart production at two plants which were forced to shut because they were no longer profitable due to gas price rises.
Eustice said that the CF deal would see the UK government support the reopening of the factories at huge expense.
“Its going to be in many millions, possibly tens of millions,” admitted Eustice, adding the fee is “to underpin some of those fixed costs.”
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