Craft breweries and soda makers in New Zealand are having problems with not enough carbon dioxide to make their drinks fizzy.
The temporary closure of New Zealand’s only liquid carbon dioxide factory has prompted beer and soda makers to cut midsummer production and warn of a depleted supply of beverages.
The Kapuni power station had been New Zealand’s only producer of food-grade CO2 since other New Zealand sites were permanently shut down last March, but it was shut down in December due to potential safety issues. It has ceased operations, said Mark McFarlane, CEO of owner Todd Energy. The facility is expected to resume production in about a week, but can only produce 30% of his pre-closure levels, and it will take several months to return to full capacity.
CO2 is used to carbonate carbonated drinks, to preserve and process many common foods, and for medical purposes. Shortages have wreaked havoc worldwide in recent years, and New Zealand is the latest country to face a sudden and devastating shortage.
“It’s a bad situation and it’s getting worse,” said Joss Raffel, co-founder of craft beer producer Garage Project. His business produces 64,000 liters of beer. but this cannot be packaged until more CO2 is generated.
“At this point, if someone delivers CO2 to us, we’ll probably pay the king’s ransom.”
The shortage has prompted domestic CO2 distributor BOC to limit supplies, prioritizing “critical medical, safety and water customers,” according to the company’s statement.
One soda producer said the rationing system was understandable but created a “capricious” supply chain.
“Today I ordered four bottles of CO2, but only got one.
Suy and other beverage makers are filling the gap with imported CO2, but getting it isn’t easy. It costs more than domestic products and delivery times and quantities are subject to uncertain global freight networks.
For companies currently looking to source their gas offshore, “it’s pretty competitive given the shortages in Europe, the US and the UK,” said the brewer, who represents some 70 brands. said Dylan Firth, executive director of the association. % of national beer sales.
New Zealand’s small market can make international competition difficult, especially for independent brewers. “There’s a scale issue,” says Firth. “They just didn’t order the quantity they needed to fill the order.”
Firth said the brewers are in talks with the government this week about long-term solutions for the industry.
Despite the restart of production at New Zealand factories, he said it was “unlikely to have a major reprieve due to limited supplies and further closures”.
In 2021, the UK government intervened to limit the damage caused by the CO2 shortage. The crisis has forced the government to bail out the country’s largest supplier. The UK is rushing to import her CO2 again in 2022, and like Germany and Italy, due to higher costs from plant closures and higher natural gas prices.
A statement from New Zealand’s Department for Business, Innovation and Employment said several agencies are monitoring the shortage and are facilitating conversations about it within the industry. Officials are also in contact with the UK government to learn from the UK’s experience.
By 2021, 84% of New Zealand’s consumption of beer will be domestically produced.
Ruffel of Wellington’s Garage Project said the sector needs to invest more in innovation, especially to develop its own CO2 capture and processing capabilities.
“They admit that the CO2 problem is an unintended consequence of moving away from oil and gas, and they don’t seem to want to see certain industries unfairly penalized,” he said.
The brewery will raise beer prices in 2022 for the first time since it was founded 11 years ago after CO2 costs “more than tripled,” Ruffell said.
“We know people are having difficulty there, so we’re really reluctant to do it again,” he added.
The shortage has sparked caution from other New Zealand food producers, from warnings that some poultry products may disappear from supermarkets to forecasting higher prices for tomatoes. Meat and dairy processors are also sounding the alarm, as are exporters who use liquid CO2 in dry ice to keep food fresh in transit.