This article is from the source 'bbc' and was first published or seen on . It last changed over 40 days ago and won't be checked again for changes.

You can find the current article at its original source at https://www.bbc.co.uk/news/business-60131946

The article has changed 4 times. There is an RSS feed of changes available.

Version 0 Version 1
Food shortage fears rise as CO2 deal deadline nears Food firms warn of product shortages if CO2 deal not agreed
(32 minutes later)
Food and drink firms have raised fears over shortages as a deal that secured vital carbon dioxide (CO2) supplies is about to end without an extension.Food and drink firms have raised fears over shortages as a deal that secured vital carbon dioxide (CO2) supplies is about to end without an extension.
CO2 is used for keeping packaged food fresh, to stun pigs and chickens before slaughter and in fizzy drinks.
A supply chain crisis was averted last year when the government stepped in to broker a three-month price-fixing deal between CO2 producers and industry.A supply chain crisis was averted last year when the government stepped in to broker a three-month price-fixing deal between CO2 producers and industry.
That deal will end in a few days, with the Food and Drink Federation warning of possible shortages on store shelves. That deal will end this month, with the industry warning it may hit supplies.
The government said it is now for CO2 firms to ensure continued supplies. Industry body the Food and Drink Federation (FDF) said there was just days left to agree a new deal.
CO2 is essential across industry and the National Health Service. In the food sector, the gas is used is used in fizzy drinks and packaging, as well as to stun animals before slaughter. "We are concerned with just days now remaining before that agreement comes to an end, and energy prices still very high, there will be further CO2 shortages once again," it added.
If shortages - caused last year because of the rising price of gas used in the CO2 manufacturing process - reappear, the food industry feels certain sectors, such as the NHS, will have to be prioritised.
Last year, CF Industries suspended production at two sites - Cheshire and Billingham - which make 60% of the UK's commercial carbon dioxide. CO2 is a by-product of producing ammonia for fertiliser.
To get production re-started, the government made available a three-week financial support package to CF and then brokered a deal to keep prices down until the end of January.
A Food and Drink Federation (FDF) spokesperson said: "The security of food-grade CO2 supplies in the UK has been a concern for our industry for some time.
"Last year's government intervention which guaranteed CF Industries production of CO2 until the end of this month was very welcome. But we are concerned that with just days now remaining before that agreement comes to an end, and energy prices still very high, there will be further CO2 shortages once again.
"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.""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."
However, it would appear that the government is unlikely to put up more money to secure supplies. Critical CO2 supply deal for food industry agreed
In a statement to the BBC, the Department for Business said: "It is for the CO2 industry to ensure supplies to UK businesses." However, it would appear that the government is unlikely to put up more money to secure supplies, saying it is up to CO2 firms to ensure continued supplies.
CO2 is essential across industry and in the National Health Service.
One US fertiliser firm, CF Industries, makes 60% of the UK's commercial carbon dioxide as a by-product of producing ammonia for fertiliser.
Last year, it temporarily shut its facilities after fertiliser manufacturing became uneconomic because of the rising price of wholesale gas, cutting off a vital source of CO2 for other sectors.
The government intervened to persuade CF Industries to continue supplies of the gas until the end of January.
To get production re-started, the government made available a three-week financial support package to CF and then brokered a deal to keep prices down until the end of January.
CF Industries said it "continues to negotiate with our industrial gas customers to extend CO2 off-take and pricing agreements".CF Industries said it "continues to negotiate with our industrial gas customers to extend CO2 off-take and pricing agreements".