PRODUCTION at Europe's biggest bioethanol plant is to be halted for up to four months.

Ensus said the move at its £250m plant at Wilton, Teesside, which opened in February last year, was a temporary measure.

All 100 full-time workers will be retained on full pay when the plant ceases production at the end of May for between two to four months.

The firm blamed lower than anticipated demand for ethanol across Europe as a result of a delay in European Union member states implementing the Renewable Energy Directive, published in 2009, which aims to ensure a certain percentage of ethanol in fuel.

In addition, the European market continues to be flooded with cheaper imports of biofuel from the United States, despite European Union attempts to address the problem.