Record gas prices a threat to food industry
11:22
Two companies that are leaders in the production of nitrogen fertilizers – Grupa Azoty and Anwil – have announced decisions to reduce and halt work at some of their facilities. Derived from these actions is a drastic reduction in the production of liquid CO2 and dry ice.
Liquid CO2 is the main raw material used in the production of carbonated beverages and brewing. The business has reacted quickly – the Carlsberg Group has already announced a halt in beer production. The brewing industry is an important economic partner of the state – it is estimated that revenues to the state budget from VAT, excise taxes, and other fees amount to more than PLN 11.5 billion, moreover, directly and indirectly, the industry generates almost 120,000 jobs. The share of beer products in the sales channels of small-format stores is also not insignificant, studies show that beer accounts for almost 30 percent of the value of sales in small stores.
Dry ice, on the other hand, is widely used in food production and storage (cooling of food components during the production process, cooling of meat in butcheries and processing plants, quick freezing). Shortages in the production of dry ice, therefore, will negatively affect the logistics chains of frozen products, which in turn will result in shortages of goods in stores.
The dairy industry could also be hit hard by shortages of CO2 and dry ice, which are used to package dairy products. Nitrogen plants, as mentioned earlier, are also a major producer of the nitric acid needed to maintain the hygiene of production lines. Without proper hygienic conditions, dairy plants will not be able to produce and thus collect milk from farmers.
