Animal welfare and fertiliser price concerns as CF Fertilisers halts UK ammonia and CO2 production

CF Fertilisers has announced it will temporarily halt the production of ammonia at its Billingham plant, which will stop the production of carbon dioxide CF Fertilisers UK has announced it will temporarily halt ammonia production at its Billingham plant ’due to market conditions’ which will halt production of carbon dioxide.Industry figures have warned the closure poses a ’serious threat to animal welfare’ and called upon the Government to act.It follows the closure of its Cheshire plant earlier in the year.CF Fertilisers intends to import ammonia to enable it to continue to run its ammonium nitrate (AN) and nitric acid upgrade plants.At current natural gas and carbon prices, CF Fertilisers UK said its ammonia production was ’uneconomical’, with marginal costs above 2,000 per tonne and global ammonia prices at about half that level.The company has notified customers who purchase CO2 on a contract basis about the impending temporary halt of ammonia production.Farmers Guardian has spoken to Environment, Food and Rural Affairs (Efra) Committee chairman Robert Goodwill, who said he was drafting a letter to Business Secretary Kwasi Kwarteng ’as we speak’."We are asking him what we can do to secure supplies of both fertiliser and CO2," he said.CO2Once the ammonia plant is shut down, CO2 production, which is a byproduct of the ammonia production process, will stop until the plant is restarted.The company said it has not yet determined the exact date when it will begin the temporary shutdown of the ammonia plant. The closure would take out the bulk of the remaining UK supply of CO2.Lizzie Wilson, chief executive of the National Pig Association, said: ‘We are currently liaising with Defra and the processing sector to establish just what the impact of Billingham ceasing CO2 production indefinitely, will be."As far as we are aware the closure won’t begin for a few weeks yet and it is helpful that we’ve been given some notice, but it will mean increased uncertainty and volatility in the market at a time when the sector is already under enormous pressure’.Nick Allen, chief executive of the British Meat Processors Association said: "We knew back in June that the closure of CF Industries’ Cheshire plant would leave UK Co2 supplies vulnerable to anything going wrong with their remaining Billingham plant and that we would be heavily reliant on overseas suppliers to make up the shortfall."Since then, ammonia producers in Italy and Germany have cut production which sent European food and drink companies scrambling to secure tightening supplies of the gas at the end of July.Concerns"Whilst we are in a much better position now than we were a year ago, if CF Industries follows through on its threat to close Billingham the British meat industry will have serious concerns."Without sufficient Co2 supplies the UK will potentially face an animal welfare issue with a mounting number of pigs and poultry unable to be sent for processing."It is for this reason that securing Co2 supplies is of key strategic importance and, following this latest development, we can’t see how Government can sit on the side lines and insist that it’s for companies to work it out amongst themselves.