Britain’s supermarkets could be looking at a barrel full of patchy shelves by midsummer as ministers quietly concoct a scenario in which the ongoing conflict with Iran chokes off carbon supplies to the country’s food and drink industry.
Whitehall officials have internally rehearsed a “reasonable worst-case scenario” should the Strait of Hormuz remain closed until June, shipping routes remain blocked and a mechanical failure at one of Britain’s key CO2 plants add to the pressure. The exercise, codenamed Turnstone, convened under the Cobra emergency framework, involved officials from Downing Street, the Treasury and the Ministry of Defense.
News of the exercise, which first emerged in The Times, has sparked a rapid reassurance campaign from ministers who insist the planning is prudent rather than panicked. Business Minister Peter Kyle told Times Radio on Thursday that the leak was “unhelpful” but argued the public “needs reassurance that we are doing this kind of planning”. CO2 supply is “not a problem” for the UK economy, he added.
However, the emergency negotiation comes at a difficult time for small and medium-sized food manufacturers, breweries and hotel operators. The summer trading window, already expanded by the World Cup starting June 11, is a crucial challenge for independent brewers and wholesalers. A squeeze on carbon emissions would quickly impact their supply chains, hitting everything from pint pulls to packaged meats.
Although carbon dioxide is a byproduct of other industrial processes, it is the quiet workhorse of British food and drink. The gas is used to stun pigs and poultry in slaughterhouses, to package fresh meat and lettuce leaves in modified-atmosphere packaging that keeps out bacteria, and to add fizz to beer and soft drinks. It also supports cooling, MRI scans, surgical procedures and nuclear reactor cooling.
The UK is one of Europe’s largest gas consumers, a dependency that has already led to preventive measures. In March, Mr Kyle committed £100m to restart the disused Ensus bioethanol plant in Teesside for a three-month period, particularly to protect against wartime shortages. On Thursday he argued the Teesside decision showed “we are implementing these sorts of measures behind the scenes to maintain the resilience of our economy”.
For its part, Britain’s largest grocer seems confident. Tesco chief executive Ken Murphy said the government had “done the right thing” to prepare for the worst. He described the analysis as reasonable and welcomed the reopening of Ensus. However, he stressed that Tesco had “seen nothing at this stage” in its own supply chain and that none of its suppliers had reported any issues with CO2 availability.
Mr Murphy, whose company has weathered six years of rolling disruption, Covid, Brexit, energy shocks and inflation, said Tesco is “constantly working on different scenarios internally” and is confident it can head off problems before they reach the factory. The bigger short-term problem, he said, had actually been the bad weather in southern Spain and North Africa, although shoppers were unlikely to see the impact as the grocer had been able to be more “flexible” in its sourcing.
A government spokesman stressed the caveat that “reasonable worst-case scenarios are a planning tool used by experts and not a prediction of future events,” adding that ministers “continue to work closely with business groups to manage the impact of events in the Middle East.”
For SME owners watching the tea leaves, the message from Whitehall is spot on: keep calm, carry on, but don’t confuse silence on the shelves with complacency in the corridors of power. With Hormuz still contentious and the diplomatic path with Tehran far from leading to a lasting solution, the summer trading season is shaping up to be a stress test for a supply chain that, as the last major carbon crisis of 2021 showed, can go from background utility to front-page crisis in a matter of days.
