Farmers supplying wheat into the Vivergo plant may have to find somewhere else to sell their product, the NFU has warned.
Major bioethanol producer Vivergo Fuels has made the decision to ‘take production facility offline for the foreseeable future’ as a result of poor ‘market conditions and legislative uncertainty’.
Vivergo, which is the UK's biggest bioethanol producer, supports 900 farms in the region.
NFU crops board chairman Mike Hambly said the union is "concerned" that the plant is shutting down for the foreseeable future.
“As the largest single intake for feed wheat in the country it is a valued customer for farmers, especially in the north east where the plant is based,” Mr Hambly said.
“During this uncertain time for farmers producing crops for biofuels, we’re calling on the Department for Transport to implement its proposals to raise the Renewable Transport Fuels Obligation and to introduce E101 to the UK fuel mix. This legislative action would give industry the confidence it needs.”
The Department for Transport has indicated that it plans to do this by April, but nothing has gone through Parliament at this stage.
Mr Hambly continued: “Farmers supplying wheat into the Vivergo plant may have to find somewhere else to sell their product, and that’s likely to be at a lower price. Alternatively farmers will have to store wheat for longer – which they may not have space for.
“Losing the animal feed that is produced as a co-product of bioethanol production means that any livestock or dairy farmers that are supplied by Vivergo’s animal feed merchants will have to source alternative proteins. This comes at a time of year when animal feed demand is at its highest.”
The AHDB estimate that access to the biofuel market adds £10/tonne to the price of wheat.
