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| CF Industries: Government strikes deal to restart CO2 production | |
| (32 minutes later) | |
| The government has struck a deal with a US company to restart production of carbon dioxide (CO2) at plants in the UK after warnings of food shortages. | The government has struck a deal with a US company to restart production of carbon dioxide (CO2) at plants in the UK after warnings of food shortages. |
| CF Industries stopped work at two of its fertiliser factories, which supplies most of the CO2 used in food production, due to soaring gas prices. | CF Industries stopped work at two of its fertiliser factories, which supplies most of the CO2 used in food production, due to soaring gas prices. |
| CO2 is widely used in the food industry in brewing and in packaging for meat and salads to prolong shelf life. | CO2 is widely used in the food industry in brewing and in packaging for meat and salads to prolong shelf life. |
| It is not clear yet what incentives the government have offered the firm. | It is not clear yet what incentives the government have offered the firm. |
| The business secretary previously ruled out nationalising the company, although providing financial support is still seen as an unusual move. | The business secretary previously ruled out nationalising the company, although providing financial support is still seen as an unusual move. |
| It could take as long as three days for the factories to start producing CO2 again at its plants in Cheshire and Stockton-on-Tees. | It could take as long as three days for the factories to start producing CO2 again at its plants in Cheshire and Stockton-on-Tees. |
| The deal comes after one food industry group warned that consumers could start noticing gaps on supermarket shelves within days if there was no intervention in its supply. | The deal comes after one food industry group warned that consumers could start noticing gaps on supermarket shelves within days if there was no intervention in its supply. |
| Carbon dioxide, produced at the two plants as a by-product, is used when slaughtering pigs and chickens to stun them. | Carbon dioxide, produced at the two plants as a by-product, is used when slaughtering pigs and chickens to stun them. |
| It is also used in beer and fizzy drinks, as well as in the vacuum-packing process. | It is also used in beer and fizzy drinks, as well as in the vacuum-packing process. |
| Ian Wright, the chief executive of the Food and Drink Federation, told the BBC earlier on Tuesday that consumers could start noticing shortages in poultry, pork and bakery products within days. | Ian Wright, the chief executive of the Food and Drink Federation, told the BBC earlier on Tuesday that consumers could start noticing shortages in poultry, pork and bakery products within days. |
| "We probably have about 10 days before this gets to the point where consumers, shoppers and diners notice that those products are not available," he said. | "We probably have about 10 days before this gets to the point where consumers, shoppers and diners notice that those products are not available," he said. |
| "It is a real crisis," he added, saying that poultry and pork production would be seriously affected by the end of this week without intervention. | "It is a real crisis," he added, saying that poultry and pork production would be seriously affected by the end of this week without intervention. |
| He also called on the government to support other fertiliser producers and help food producers to look for alternatives to CO2. | He also called on the government to support other fertiliser producers and help food producers to look for alternatives to CO2. |
| Farmers fear gas price crisis may spark pig cull | Farmers fear gas price crisis may spark pig cull |
| How could the CO2 shortage hit food supplies? | How could the CO2 shortage hit food supplies? |
| Gas price crisis: Government poised to step in | Gas price crisis: Government poised to step in |
| The BBC understands that the deal with CF Industries has been drafted so that other companies who stop production due to high commodity prices will not be able to ask the government for similar help. | The BBC understands that the deal with CF Industries has been drafted so that other companies who stop production due to high commodity prices will not be able to ask the government for similar help. |
| Norwegian firm Yara has also cut production at a number of European factories, including one in Hull. | Norwegian firm Yara has also cut production at a number of European factories, including one in Hull. |
| Business Secretary Kwasi Kwarteng had said previously that "time is of the essence" in organising the deal with CF Industries, acknowledging that "it may come at some cost". | Business Secretary Kwasi Kwarteng had said previously that "time is of the essence" in organising the deal with CF Industries, acknowledging that "it may come at some cost". |
| Knock-on effects | Knock-on effects |
| A spokesman for the British Meat Processors Association said: "It is good news that they will be reopening the plants. | A spokesman for the British Meat Processors Association said: "It is good news that they will be reopening the plants. |
| But, he added: "The key question for us is when will the plants be back on stream, as every day of disruption has knock-on effects for the meat processing industry." | But, he added: "The key question for us is when will the plants be back on stream, as every day of disruption has knock-on effects for the meat processing industry." |
| Andrew Opie, director of food and sustainability at the British Retail Consortium, also welcomed the deal but said it was "vital" that production "is restarted as soon as possible, and [CO2 is] distributed quickly to food manufacturers in need of it". | Andrew Opie, director of food and sustainability at the British Retail Consortium, also welcomed the deal but said it was "vital" that production "is restarted as soon as possible, and [CO2 is] distributed quickly to food manufacturers in need of it". |
| On Tuesday, Prime Minister Boris Johnson urged people not to worry about putting food on the table this winter, amid rising energy and food bills and a cut to universal credit. | On Tuesday, Prime Minister Boris Johnson urged people not to worry about putting food on the table this winter, amid rising energy and food bills and a cut to universal credit. |
| Wholesale prices for gas have surged 250% since January, with a 70% rise since August alone, leading to calls for support from the industry, and the collapse of some smaller energy firms. | |
| The resulting shortage of carbon dioxide saw warnings about the potential impact on food suppliers, as well as the NHS and the nuclear industry, where it is used as a coolant. | |
| Mr Opie added that the government should also take action on other issues affecting food retailers in recent weeks, such as the shortage of HGV drivers, which has been exacerbated by the pandemic and many drivers returning to the European Union after Brexit. | Mr Opie added that the government should also take action on other issues affecting food retailers in recent weeks, such as the shortage of HGV drivers, which has been exacerbated by the pandemic and many drivers returning to the European Union after Brexit. |