THE immediate future is saved for the food and drinks industry after the Government brokered a deal with the carbon dioxide industry to ensure supplies continue to be available.

The rising price of gas forced a major CO2 producer, CF Fertilisers, to shut down its two UK plants last month - one in Billingham - choking off supplies that are used across numerous industries including stunning animals for slaughter, extending the shelf life of food, aiding in surgical operations and cooling nuclear power plants.

Carbon dioxide is a by-product of fertiliser manufacture and the US firm supplies around 60 per cent of the UK’s needs.

The Government stepped in for a three-week period to prop up the firm in a move that was expected to cost “possibly tens of millions” of pounds, according to Environment Secretary George Eustice.

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But now the Business Secretary, Kwasi Kwarteng, said a “more sustainable solution” had been found.

The deal means that until January 2022, those who buy CO2 from CF Fertilisers will pay a set price, which will allow the company to continue operating while global gas prices remain high.

And the Department for Business, Energy and Industrial Strategy (BEIS) said this reflected “the vital importance of this material to everything from our nuclear industry to hospitals to the food and beverage industry”.

Mr Kwarteng said: “Today’s agreement means that critical industries can have confidence in their supplies of CO2 over the coming months without further taxpayer support.

“The Government acted quickly to provide CF Fertilisers with the support it needed to kick-start production, and give us enough breathing space to agree a longer-term, more sustainable solution.

“I would like to thank all the parties involved in this agreement who have recognised the importance of avoiding supply disruptions and delivering for UK businesses and consumers.”

Mr Eustice added: “CO2 is vital for our food and drink sectors. The Government has taken decisive action in these exceptional circumstances to allow a deal to be reached which will continue the supply of CO2 to businesses – including thousands of food and drink businesses – up and down the country.”

Last week, Mr Kwarteng temporarily exempted parts of the CO2 industry from competition law to facilitate the agreement and provide further security of CO2 supplies to UK businesses.

Previously, Mr Eustice had warned that companies would have to accept a large rise in CO2 rates, with a possible fivefold increase from £200 a tonne to £1,000.

Tees Valley Mayor Ben Houchen said: “The resumption of production at CF Fertilisers’ Billingham plant three weeks ago was a huge relief for the hundreds of hard-working staff and their families who had been facing uncertainty during the production pause. Today’s announcement that government is extending support until January 2022 will be a further relief to local workers.

Alex Cunningham, MP for Stockton North, said: “This agreement will safeguard local jobs, and I will continue to work with everyone involved to reach a satisfactory long-term resolution for our local workers.”

“I am pleased that an agreement has been reached which will see CF Fertiliser able to continue operating. This announcement is good news for our area, the people who work at CF, and the many businesses, from food processors to hospitals, who rely on the CO2 produced as a by-product in the manufacture of fertiliser.

“This is a short-term industry-led agreement, however, and there is still a great deal of uncertainty about what comes next. The Government needs to do more than simply facilitate these conversations between industry; it needs to act. Industries like CF Fertilisers need to see Government action on fundamental issues transportation and carbon costs so they can guarantee a more sustainable future. These are the things I’ve raised with Ministers time and again, yet they continue to fall on deaf ears.

“I’d again urge the Energy Secretary to look again at the underlying issues the industry and I are telling him about and come up with a plan to deal with these as a matter of urgency.”