CO2 shortages continue, regional variations
Carbon dioxide (CO2) shortages are still being experienced in the US despite recent improvements in the production of ethanol.
CO2 is captured as a by-product in ethanol production which at full capacity accounts for roughly 40% of the US national carbon dioxide supply, according to trade group Renewable Fuels Association (RFA).
When ethanol plants were idled earlier this year due to a reduction in fuel demand caused by lockdowns to restrict the spread of the coronavirus pandemic, it contributed to CO2 shortages across the US. This led to concerns in the food and beverage industry as carbon dioxide is used for beverage carbonation, food processing and food preservation (freezing, storage, transportation and modified atmospheric packing).
Florida-based CO2Meter, a provider of carbon dioxide sensors, monitors and data loggers, says there are still CO2 shortages, allocations and price rises.
“Typically there have been no good or bad months, and supply has been tightening even more in late summer,” Josh Pringle, Vice-President of Business Development at CO2Meter, told gasworld.
Pringle understands that companies are still on allocation, with added costs for CO2. He said, “Majors and independents are getting hammered by the lack of supply. Some major food and beverage producers are paying $1,000+ a tonne for CO2 right now just to stay in production. Some foresee that a bidding war could start for supply.”
Regional variations mean some have been hit harder than others during CO2 shortages this year.
“West Coast was hit the hardest in the spring/early summer,” Pringle said.
“Midwest is getting crushed right now with some East Coast effects too.”
Maura Garvey, of Intelligas Consulting, a consultancy specialising in strategic analysis and forecasting in the industrial gas industry, believes the CO2 situation will improve through the fall.
“I talked to those in the business they said when ethanol plants went down initially in April it wasn’t as difficult to manage early on as demand was also off due to businesses shutting down,” Garvey told gasworld.
“The effect of Covid-19 was delayed. Now you have got these other [CO2 producing ammonia] plants that are down. Ethanol is back and doing great but it’s other big plants that are down for maintenance that are causing problems. It’s typical for some of these ammonia plants to shut down at this time of year for maintenance following the planting season. There is a big CO2 plant in Virginia that is down.”
Garvey added, “Until primary production increases the by-product production (like CO2), supply will be tight. There are shortages and shortages are the worst on the East Coast and West Coast. There are also spot shortages too, depending on where you are in the country. Customers are also struggling to find transportation to get CO2 to their facilities. By the end of October, we should be over the worst of it. I would hope that by the end of the year we should be getting back to normal.”
David Burdick, Division Manager at Reliant Gases, which has its own sources, plants and transportation network, agreed that CO2 shortages are being felt most acutely on the coasts.
Burdick told gasworld, “While we experienced a short lull in the supply shortage, it has grown dramatically worse in the past couple months. The East and the West Coasts are experiencing the worst of the shortages at the moment, but the industry is mobilising to supply those areas from other sources. The CO2 is available, it’s just in parts of the country that require extensive transportation assets, and additional cost, to get it to the affected areas. Being that many of our plants are supplied from geologic sources, our customers have not experienced supply interruptions or been negatively impacted.”
Sam A Rushing, President of Advanced Cryogenics, Ltd, and CO2 expert, writes in the gasworld US October issue, “The worst months for CO2 supplies can often be in and around the summer season. Beyond ethanol, this summer has been particularly harsh, due to key plants in the Midwest and Mid-Atlantic closing or planning to turnaround which are anhydrous ammonia sources. This will continue well into the fall, with the Hopewell, Virginia plant reducing capacity. There may not be a return to supply normalcy for some time.”
Rushing added, “I believe shortages will continue for the rest of the year, driven by ethanol issues. Until Covid-19 is under control, it is hard to see things returning to normal, considering our current CO2 supply portfolio domestically.”
An increased demand for dry ice, some of it related to coronavirus vaccine research and shipping samples, is being driven by pharmaceutical industries, hospitals, laboratories and home delivery services which may put increased pressure on carbon dioxide supplies.
Full coverage of the CO2 shortage in the US is covered in the October issue of gasworld US, which focuses on CO2 and the food and beverage industry.
This article appeared on the gasworld website at https://www.gasworld.com/co2-shortages-continue-regional-variations/2019816.article]]>