The UK’s food supply is now ‘vulnerable’ after one of the country’s only two large fertiliser facilities closed owing to rising energy costs just months after obtaining a taxpayer bailout.
After the price of natural gas made the plant unprofitable, CF Industries will close its Ince, Chester, facility, putting roughly 300 jobs at jeopardy.
It has been closed since last year, when ministers intervened to prevent a supply crisis by granting CF Industries a tens of millions of pounds subsidy. The rescue allowed the company to reopen its Billingham factory in Teesside, which will now supply all of its UK fertilizer output.
As a by-product of fertiliser manufacture, the American firm produces 60% of Britain’s CO2, which is used in a wide range of applications.
After the price of natural gas made the plant unprofitable, CF Industries will close its Ince, Chester, facility, putting roughly 300 jobs at jeopardy.
The gas is used to shock animals in preparation for slaughter, to package meat, and in refrigeration systems. Fizzy drinks, beer, cheese, fruits and vegetables, and crumpets, among other things, contain it.
Last year, the UK faced a CO2 “crisis” as a result of a 70% increase in wholesale gas costs, which forced the corporation to suspend operations.
The British Meat Processors Association’s chief executive, Nick Allen, claimed that reducing Britain to only one factory made food supply more ‘vulnerable.’
‘We’re assured by CF Industries that there will be no disruption to Co2 supplies to the meat industry, however the closure of one of only a handful of facilities in the UK means that future supplies will become somewhat less secure, particularly if something were to go wrong with the remaining plant at Billingham,’ he said.
‘We are becoming more dependent on individual points in the supply chain.’
The National Farmers’ Union (NFU) has warned that high fertiliser prices could dissuade farmers from growing the wheat needed to make bread. Prices have risen to around £625 per ton compared to £200 per ton pre-Covid.
NFU Deputy President Tom Bradshaw said: ‘Today’s announcement from CF Fertiliser is a further blow for farmers who are already suffering from incredibly high inflation for fertiliser costs.
‘This closure confirms our fears that the Ince plant may be permanently shut down, having been temporarily closed since last September.
‘This comes at a time when costs and supply face unprecedented risk. This closure is likely to further restrict global supply and we are seeking urgent clarification from CF on the production capabilities of its remaining plant at Billingham.’
Jo Gilbertson, head of fertilisers at the Agricultural Industries Confederation, warned the closure could put further upward pressure on food prices.
“This will affect all sorts of things. If we don’t have access to nitrogen fertilisers it affects everything from the cost of milk and meat products on the shelves to the price of bread because milling wheat needs the high protein level you get from nitrogen,’ she told the Telegraph.
‘Then you have to import grain and there’s a shortage of that because of the crisis in Ukraine.’
After the price of natural gas made the factory unprofitable, CF Industries will close its plant in Ince, Chester, putting nearly 300 jobs at risk.
The gas is used to shock animals for slaughter, to package meat, and to keep food cold. Fizzy drinks, beer, cheese, fruit and vegetables, and crumpets, among other things, contain it.
Last year, the UK faced a CO2 “crisis” as a result of a 70% increase in wholesale gas costs, which forced the corporation to shut down operations.
The British Meat Processors Association’s chief executive, Nick Allen, said Britain’s food supply was more ‘vulnerable’ as a result of being limited to just one factory.
‘The Government gave only limited financial support, for three weeks last year, to restart the Billingham plant.
‘Without intervention, the CO2 shortage could have severely impacted the food processing sector, the NHS and nuclear power generation.’
