We are currently facing shortages of carbon dioxide, CO2, primarily needed for our food and drinks industry. Which, as Alanis Morrissette once sang, is ironic, seeing as it’s the one thing we are trying to get rid of: the climate crisis and all.
But it’s not as straight forward as that. CO2 is a by-product of fertiliser production, something very useful for growing the food we all need. Handily the CO2 isn’t simply off-gassed into the atmosphere, but has been turned into a viable product in itself, sold back to the same food industry, but just further down the value chain. Here it is used in several ways, including the humane stunning of animals before slaughter, and to provide an inert atmosphere to package a wide variety of perishable goods.
Here’s the crunch. The UK relies on two main facilities for its CO2 provision, sourcing more from overseas. But due to the global rise in demand for natural gas, and the concomitant spike in price, the two plant have been temporarily shut down. This is the culmination of the oft-quoted perfect storm: a rise in demand across the world for natural gas for heating and to power industry as economies emerge from the pandemic, in Asia in particular; more of the UK’s nuclear reactors are offline for maintenance than expected – five compared to two; and September has seen unseasonably settled weather – 3°C higher than averages that go back more than 300 years, with lower winds to boot.
So, whilst Alanis might have claimed this is all so ironic, it actually shows a deeper issue: that of supply chain resilience and the interconnectedness of everything we make, buy and use. This is brought into starker focus due to the work we need to do to mitigate and adapt to the impacts of climate change. This is nothing new. Back in 2011 there were massive floods in Thailand that caused huge disruption to supply chains for digital components, affecting car and computer manufacturers. Why? Because, as one commentator said, “Thailand represents 4-8% of global capacity for any one company”. The old proverb that having all your eggs in one basket is not a good idea, rings true here.
What it tells us is that we need to assess the weak points in our supply chains for security of supply, and choice of where we can reliably get the products, materials and components we need. Relying on a small number of suppliers doesn’t make sense in this context, or indeed for innovation, competition and for driving down carbon emissions. When we find a pinch point, we need to put measures in place to diversify our supply chain, encourage and support other organisations to supply and not rely so much on the market ‘sorting itself out’. All of which means good supply chain procurement.
 Irony isn’t actually the right word; coincidence is more applicable, but we shouldn’t let semantics get in the way of a good 90’s popular cultural reference.
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