UK government financial support to keep CF Fertilisers UK’s Billingham ammonia plant in northeast England running is looking unlikely, despite warnings by the country’s biggest meat processors and other major users of CO2 that the country’s food security could be under threat and shoppers exposed to a “price shock” after a more than threefold surge in the price of CO2.

The renewed concerns come amid planned temporary closures by CF and Ensus UK Ltd., the country’s second biggest supplier of the gas.

The UK requires 2,000 mt/d of CO2, according to figures cited by the UK’s Guardian newspaper on Sept. 2. It is critical for stunning animals before slaughter, as well for soft drink producers, brewers and bakeries, and in packaging, and also in the country’s hospitals and nuclear power industry, among others.

Of the total CO2requirement, CF Fertilisers’ Billingham plant has the capacity to produce 750 mt of CO2per day as a byproduct of ammonia production, and supplies some 42% of the UK’s CO2.

The Ensus biomass plant at Wilton International has the capacity to make around 250,000 mt/y of CO2as a byproduct, which is up to 40% of the UK’s demand, a spokesperson for Ensus told Green Markets.

According to the Guardian report, just 600 mt of CO2could be imported.

CF Fertilisers UK, a subsidiary of the US’ CF Industries Holdings Inc., on Aug. 24 announced its intention to temporarily halt ammonia production at the Billingham Complex due to soaring natural gas costs as well as current carbon prices, which it said has made ammonia production at the site uneconomical (GM Sept. 2, p.28; Aug. 26, p. 1). But CF has yet to confirm the exact date of the planned temporary ammonia production stoppage.

According to a UK Press Association report on Sept. 8, citing the Chairman of the country’s Environment, Food, and Rural Affairs, Conservative MP Sir Robert Goodwill, the Billingham ammonia plant “is paused, waiting for deliveries of ammonia.”

In its Aug. 24 announcement, CF said it intends to use the Billingham site’s ability to import ammonia to enable it to continue to run its ammonium nitrate and nitric acid plants.

A company spokesperson this week had not responded to Green Markets‘ enquiries by press time regarding an update on the planned temporary shutdown, whether it had any ammonia cargoes on the water for Billingham, or if the company was in any discussions with the UK government on financial support to keep the Billingham ammonia plant running.

The Ensus spokesperson confirmed that its Wilton International plant stopped production for its annual maintenance overhaul earlier this week, with the overhaul typically running for around three weeks, depending on the amount of work needed to be done. The company sends its CO2 to Nippon Gases UK Ltd., from where it is sent to the market.

Some of the UK’s biggest CO2 users have called on the country’s government to provide financial support to CF Fertilisers – as it did in September 2021 (GM Sept. 24, 2021) – in order that the company keeps ammonia production going at Billingham complex in order to maintain supplies CO2 supplies.

CO2 users have also asked the government to consider price capping the CO2market. Unnamed industry insiders, cited by the UK’s Guardian newspaper on Sept. 2, said prices had risen to as much as £4,500/mt (approximately $5,168 at current exchange rates ), up from about £1,000 the previous week, and just £200 in 2021.

According to a statement provided to Green Markets by the UK’s Department for Business, Energy, & Industrial Strategy (BEIS), the government is “confident CO2 stocks are secure for the coming winter.”

“While the market’s resilience has improved in the past 12 months with additional imports, further production from existing domestic sources, and better stockpiles, the government is continuing to examine options to improve this over the longer term,” a government spokesperson said in the statement.

However, the spokesperson added that “it is still essential that the industry acts in the interest of the public and business to do everything it can to meet demand.”

The department also said government continues to work with industry to see what more industry can do to achieve a more sustainable and resilient market in the long term.

“However, it is ultimately for the CO2 industry, not government, to ensure supplies to UK businesses,” it said.

A new Secretary of State for Business, Energy, and Industrial Strategy was appointed on Sept. 6 as part of the Cabinet reshuffle of the newly elected Conservative Party leader and Prime Minister Liz Truss. Jacob Rees-Mogg was appointed Secretary of State for Business, Energy, and Industrial Strategy on Sept. 6.

UK agricultural interests and farmers are also concerned about the impact of any pause in production at CF’s Billingham plant. The company’s Ince plant near Chester in the UK’s northwest has been shuttered since September 2021, and is now permanently closed.

Goodwill this week highlighted that the UK requires around 2.2 million mt of nitrogen fertilizers – and a million mt of that, he said, came from the Ince and the Billingham plants. According to the UK Press Association report, he has asked the UK’s newly-appointed Environment, Food, and Rural Affairs Minister, Mark Spencer, when the first load of ammonia will arrive at Billingham and when ammonium nitrate production will [re] commence.