Concerns over the impact of Britain’s high energy prices reached new levels on Friday as the country’s meat industry warned that supplies of chicken, beef and pork could be affected.
The British Meat Processors Association said the recent closure of fertilizer plants in Britain and elsewhere in Europe due to rising natural gas prices threatened to lead to shortages of carbon dioxide, which is widely used in the industrial food industry.
A spokesperson for the meat processors said carbon dioxide is used to stun animals such as pigs and chickens before slaughter, under regulations designed to protect animal welfare. The gas is also injected into meat packaging to extend shelf life in supermarkets.
The group said in a statement that once current supplies of carbon dioxide run out – it was estimated that less than 14 days were left – some companies would have to “stop taking animals and close production lines.”
The association added that production problems in the pork industry farmers to cull their animals soon. Retailers of food and other products in Britain have been complaining for weeks that a shortage of truck drivers, caused in part by Brexit, has hampered stocks.
The sudden food supply concerns illustrate how problems in one industry – in this case record high natural gas prices – can quickly spill over into another in a highly interconnected economy like Britain’s. Analysts blame high gas prices on rising demand from China and low storage levels in Europe with winter approaching.
High gas prices have already pushed up electricity prices in the UK, Spain and elsewhere in Europe, putting pressure on consumers and industry. A fire that caused a major power outage in an electricity cable between Britain and France on Wednesday put further pressure on electricity prices.
Fertilizer makers use huge amounts of natural gas to make ammonia, producing amounts of carbon dioxide as a byproduct. The gas is captured and sold to food companies and other industries for fizzy drinks, among other things.
The first indication that the flow of carbon dioxide could be curtailed came on Wednesday when US-based fertilizer manufacturer CF Industries said it was responding to the recent rise in natural gas prices by two major plants in northern England, in Ince and Billingham. to close.
On Friday, Yara, a major Norwegian fertilizer producer, said it is also suspending production of about 40 percent of its European capacity.
“The record high natural gas prices in Europe are impacting ammonia production margins,” Yara said in a statement.
According to the meat processors’ association, those factory closures involved factories that Britain could have called on for emergency supplies.
The group said the carbon dioxide market was unregulated, so there was little information about how much of the gas was available. It called on the British government to intervene “to prevent this from happening again”.