Farmers across the UK are set to lose out on a market for wheat and a badly-needed source of animal feed due to the imminent closure of the Vivergo Fuels plant.
The Hull-based biofuels plant will cease production at the end of September, with bosses blaming a ‘difficult trading environment’ and the Government’s failure to rollout E10 fuel, which has a higher ethanol blending ratio than petrol currently on sale.
When producing bioethanol, Vivergo bought more than 1 million tonnes of feed wheat from 900 farms every year, mainly across East and North Yorkshire and North Lincolnshire.
Its plant was also the country’s largest single production site for animal feed, delivering 500,000 tonnes of high-protein feed to over 800 farms all over the UK.
‘Significant’ job losses are expected as a result of the shutdown.
Mark Chesworth, managing director of Vivergo Fuels, said: “I am extremely disappointed at having to make this difficult choice to plan to cease production as of the 30 September 2018 at the Vivergo Fuels plant.
“We have created a highly skilled and world-class business which had the opportunity to be part of a British sustainable biofuels industry.
“But sadly, the Government’s lack of pace over the past decade to introduce E10 has further undermined our ability to operate. My employees are my number one concern at this time and we have entered into consultation with them.
“I would like to take this opportunity to thank our workforce, past and present partners, growers and customers for their support since the creation of our plant in 2007.”
The decision to cease production will also come as a blow to the Humber region, which benefited from £400 million investment from Vivergo.
NFU combinable crops board chairman Tom Bradshaw said: “This announcement is a significant blow for the UK grain industry.
“As the largest single intake for feed wheat in the county, it will particularly hit arable and livestock farmers in the North East where the plant is based.
“At a time when livestock farmers are suffering with feed shortages, this decision will also have serious knock-on effects for protein feed availability, with farmers becoming more reliant on imported feed for their livestock.
“Unfortunately, the biofuel industry has suffered for a number of years following Government procrastination on renewable fuel policy.
“The private sector has invested hundreds of millions of pounds on the premise of a supportive policy, only to be let down by Government back-tracking.”