A decision to shutdown a biofuel plant in Hull will impact upon growers across the country, the National Farmers’ Union (NFU) has warned.
Plant operator Vivergo has confirmed it is taking its production facility offline “for the foreseeable future” over uncertain governments plans to roll out the availability of E10 fuel, a low-carbon renewable transport fuel which is blended with petrol and is already widely used in other EU countries.
In a statement, Vivergo said: “Over the past six weeks we have seen bioethanol prices fall significantly impacting Vivergo profit margins further. Whilst there have been some supply increases this year, the bioethanol market in the UK remains constrained by the Government’s inaction.”
Vivergo’s plant in East Yorkshire is the UK’s largest, and Europe’s second largest producer of bioethanol.
The NFU is “very concerned” about the implications of the shutdown for farmers, said Brett Askew, chairman of the union’s North East regional crops board, who explained: “As the largest single intake for feed wheat in the country, Vivergo represents a significant market for arable farmers, and is also an important supplier of high-protein animal feed for the livestock sector. Such is their importance that their loss will be felt right across the sector.”
Farmers are already selling their wheat below the average cost of production, he said, and with biofuel plants supporting the UK wheat price by an average of £10 per tonne, the closure represents a potential loss of £150m in an average UK harvest year.