Vivergo Fuels, the UK’s largest bioethanol producer, has taken its last scheduled wheat delivery amid uncertainty over the site’s future. The firm’s campaign calling for Government intervention has been supported by local politicians including Mayor Luke Campbell who recently visited the site.
The plant, which is based at the Saltend Chemicals Park, near Hull, has been impacted the US-UK trade which removed an existing 19 per cent tariff on ethanol products imported from the United States. Vivergo Fuels warns that it is unable to compete with the cheaper and less regulated US products without the tariff.
The last scheduled wheat delivery comes after it was revealed a £1.25 billion green jet fuel investment hangs in the balance and could be relocated abroad if the Vivergo plant is to close. Meld Energy warned that the situation threatens to derail its ambitious plans for a “world-class” sustainable aviation fuel venture on the Humber.
In recent weeks, Vivergo has teamed up with other Saltend-based companies to stress how the site works as an integrated block. Therefore, the loss of Vivergo, they say, would impact the entire site. An open day was recently held at the chemicals park to explain the significant role Vivergo plays there.
Vivergo Fuels managing director Ben Hackett wrote to wheat growers in May explaining that the plant will only be able to honour existing contractual obligations for wheat purchases while uncertainty continues. The plant buys over one million tonnes of British wheat each year from more than 4,000 farms, mostly across Yorkshire and northern Lincolnshire, and has purchased from 12,000 individual farms over the past decade.
Mr Hackett said the plant is a “huge part of the local economy” and is vital for future growth and investment in the area. He added: “We have a choice of going down a path of stagnation, decline, unemployment, economy shrinking, or we have a choice of going towards a path of investment, growth, prosperity, job creation, and that’s why it’s crucially important that the Government comes to a decision quickly, and comes to a decision in favour of supporting the UK bioethanol industry.”
Matt Pickering, partner and farm manager at F Pickering and Sons, near Gainsborough, Lincolnshire, who sold the last load of wheat to Vivergo said he was worried about the future market as he normally sells “a couple of thousand” tonnes of wheat a year to Vivergo and now “there’s going to be more grain to be bought by less people.” The 40-year-old father-of-one from Harpswell, Lincolnshire, said: “We tend to focus more on feed varieties of wheat, rather than milling. We struggle with the quality of our land type, so we tend to go for out-and-out bulk volume shed fillers. Vivergo has been a fantastic home for us to sell feed wheat into.”
Following the final wheat delivery, Jamie Burrows, National Farmers’ Union Combinable Crops Board Chair said: “The UK biofuels industry is an important market for the domestic crops sector taking in more than two million tonnes of wheat a year while playing a key role in producing a vital source of animal feed as a by-product and CO2 used by the wider food supply chain.
“Not only are there huge implications for those growers that currently supply Vivergo in losing a vital market for their product, but this also has the potential to put further downward pressures on farmgate prices at a time when our arable farmers are already facing huge challenges including extreme weather and ongoing market volatility. In order to open up further market opportunities to incentivise UK wheat being used by UK biofuel plants, the NFU is calling for Government to allow more biofuels from crops to be used in road transport and aviation.”
By: Andrew Spence, LDRS
