ECONOMY

UK poultry producers take emergency measures as gas shortage intensifies

Food & Beverage updates

UK poultry producers have started taking emergency measures to conserve carbon dioxide used to stun birds for slaughter as a shortage of the gas poses an increasingly grave threat to the meat supply chain.

The poultry industry has said plants hold only one to five days’ CO2 supply on site and warned of disruption to the chicken supply chain once that runs out.

The closure of two UK fertiliser plants by US company CF Industries, because of surging natural gas prices, has cut off about 60 per cent of the country’s commercial CO2 production.

The UK government has been in talks with Tony Will, chief executive of CF Industries, about potential solutions for reopening the plants, which may include subsidising fertiliser production.

But the Department for Environment, Food and Rural Affairs told meat industry leaders on Monday that it did not yet have a deal to announce, though it hoped to do so soon, according to two people present at a meeting on the issue.

Business minister Kwasi Kwarteng on Monday told Parliament that the government was monitoring the situation “minute by minute” and had “explored quite thoroughly possible ways to secure vital supplies [of CO2]”.

The chief executive of one big British supermarket group said: “We are speaking to all our suppliers, some are saying it’s not a problem and they have got several weeks supply left, some are down to their last few days.”

He added that the CO2 problem was compounding availability issues due to the shortage of truck drivers, which was already disproportionately affecting lines such as carbonated drinks.

Another supermarket group described the problem as “tight but manageable” but added it was making contingency plans with suppliers, such as using alternative gases in meat and bread packaging, although this would result in shorter shelf lives and increased waste.

The supermarket added that many processors were looking to Europe for CO2 supplies, though this would increase costs and depend on the availability of staff to drive gas tankers to the UK. 

Richard Griffiths, chief executive of the British Poultry Council, said deliveries of carbon dioxide had started to arrive that were short of the amounts that companies had ordered.

Some meat processors have reactivated old electrical stunning equipment — which processes birds about 30 per cent more slowly — and diverted CO2 from packaging to slaughter.

“But not everyone has the kit [for electrical stunning] and not everyone has the people trained to operate it,” added Griffiths.

The fertiliser plants would take about three days to return to normal production levels once they restart, meaning there was a narrow window in which to avoid disruption to chicken supplies and overcrowded chicken farms, executives said.

“It’s not just a food issue, it’s an animal welfare issue,” said Ian Wright, chief executive of the Food and Drink Federation. “Production of chicken and other poultry will be pretty severely impacted in the next few days . . . The continuity of food supply to Christmas is right on the edge.”

He added that if the plants returned to full production this week, “it’s quite likely that consumers and shoppers wouldn’t notice much, though there will be some gaps on shelves”. But a longer hiatus would result in severe disruption, he warned.

Pig farmers, meanwhile, said they were two weeks away from culling healthy animals after labour shortages at abattoirs left about 100,000 surplus pigs already backed up on farms. One abattoir, at Cheale Meats in Essex, uses electrical stunning but can process only 7,000 pigs a week, compared with 180,000 for the broader sector, said the National Pig Association.

Adam Couch, chief executive of pork and chicken producer Cranswick, said: “I call upon the government to act immediately . . . The sector has been asking for support to ease the labour crisis, and now CO2 shortages could effectively bring production to a halt throughout the supply chain.”

Andrew Opie, director of food and sustainability at the British Retail Consortium, said: “Disruption to CO2 supplies could not have come at a worse time, with the shortfall of 90,000 HGV drivers already putting severe pressure on food production and distribution.”

Producers of bakery products and carbonated drinks also face problems. Analysts at Citi said Britvic, which makes Pepsi and 7UP drinks in the UK, “has good availability of CO2 supply for this week but is already looking to source additional gas from alternative suppliers”. 

Additional reporting by Alice Hancock

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