CO2 Recovery Protects Craft Breweries Against CO2 Supply Disruptions
In recent years, CO2 shortages have posed a significant challenge for breweries across Europe, Australia, and islands. In North America, fluctuating CO2 prices have added to the uncertainty, with Canada and several U.S. states being hit particularly hard. The shutdown of major CO2 recovery plants, whether due to maintenance or permanently, has left many breweries struggling to maintain operations. These shutdowns have caused CO2 prices to skyrocket to as much as six times their previous levels in some areas, not including additional surcharges.
The looming scarcity of CO2 is creating ripples across multiple industries and could particularly impact the brewing and beverage sectors. Previous challenges in the supply chain were intensified by COVID-19, the tightening of emission caps, and contamination incidents at a key CO2 production site located at Jackson Dome, MS, USA.
The unprecedented circumstances during the COVID-19 pandemic resulted in a significant reduction in air travel, factory closures, widespread job cuts, and a widespread shift to remote work, leading to a sharp decline in jet fuel demand and a rapid decrease in gasoline consumption, as outlined in a 2022 Wall Street Journal article*. This downturn had a domino effect on the oil and gas industry, affecting essential processes like crude oil extraction, petroleum refining, and ethanol production. As a result, the production of carbon dioxide, a vital byproduct of ethanol, suffered, with numerous ethanol plants that supply CO2 temporarily halting operations. The subsequent contamination incident at Jackson Dome further exacerbated the ongoing CO2 shortage, presenting significant challenges for industries heavily reliant on this essential gas.?
Upcoming CO2 Supply Disruptions in the States
The upcoming years are poised to be a critical period for the merchant CO2 supply, with a growing focus on CO2 sequestration to address climate change. CO2 has always presented unique challenges compared to other sectors, given its status as a byproduct gas sourced from various industries. Supply challenges arise when peak demand aligns with plant shutdowns geared towards other outputs. The regulatory landscape in the US has created opportunities for CO2 sequestration to address urgent issues of global warming and the climate crisis. In 2024, indications suggest that this emerging market segment may divert a significant portion of CO2 away from the merchant market, adding pressure to the already strained supply. In some cases, suppliers are incentivized more to sequester CO2 than to sell it. This points towards a future where new sources of CO2 will be essential to maintain a stable market, making it crucial for craft brewers to rely on their own CO2 production. The scheduled maintenance shutdown of The Hopewell plant in Virginia in September 2024 and the Nutrien ammonia plant in Georgia, critical sources for CO2 supply in the US, will impact numerous CO2 suppliers and further strain an already dwindling supply.
CO2 Recovery Secures Own Supply CO2
Many breweries have recognized the critical importance of independence from external CO2 sources. Investing in a craft-scale CO2 recovery system provides a reliable, cost-effective, and sustainable CO2 source, safeguarding your operations against supply disruptions.
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By installing your own CO2 recovery plant, you can protect your brewery from the volatility of the current market and ensure continued production, regardless of external circumstances.
At DALUM Beverage Equipment , we are proud to meet the growing demand and need for craft breweries to access affordable and advanced technology.
Read more about our CO2 recovery solutions for craft breweries and beverage manufactures here.
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