The Reason Behind The Upcoming Beer Shortage Isnít What You Expect

Posted: Jul 14, 2020

COVID-19 shutdowns mean we're drastically short of one vital component

The reason we’re possibly about to have a beer shortage — and a soft drink shortage — is related, somewhat, to driving.

Or the lack thereof.

As Sky News reports, supplies of carbon dioxide from ethanol plants — which produce CO2 as a byproduct from the fuel production process — are running low. And the production of ethanol (which is blended into the fuel supply) has fallen as demand for gas has been heavily reduced during nationwide lockdowns.

“The supply [of CO2] is rapidly deteriorating,” Geoff Cooper, president of the Renewable Fuels Association, tells Forbes. “Absent of some intervention to keep these facilities running, it will further deteriorate. We’re on the verge of something fairly disruptive. It’s going to be hard to come by.”

Right now 34 of the 45 U.S. ethanol plants that sell CO2 have stopped work and cut production, while CO2 suppliers have increased costs by 25 percent. Craft distilleries get almost half of their CO2 from ethanol supplies.

In a letter to Vice President Mike Pence from the heads of associations representing beer, meat and fuel industries, they suggested “CO2 production may be reduced by 50% by mid-April unless action is taken to stabilize existing sources of CO2, prevent production sources who are indicating they will shut down from doing so, and reopen those sources that have halted production thus far.” (Meat producers also use CO2 in packaging and shipping.)

While big producers have the capability to recapture some carbon dioxide, that expensive machinery is out of range for the craft industry. At the very least, expect prices to go up as the industry deals with a tighter and more expensive CO2 market.

By Kirk Miller
April 21, 2020
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