US Craft Brewers Facing Critical C02 Shortage

American brewers are facing a major carbon dioxide shortage and scrambling to find whatever C02 they can get their hands on. And no CO2 means no beer…

“Beer makers buy a lot of carbon dioxide,” according to Marketplace. “They use it not only to add some fizz to your IPA, but also to purge tanks for cleaning and to transfer beer from tank to bottle.

The essential gas contributes to beer foam, shelf stability and it’s used throughout the production and packaging process.

Big breweries, like Budweiser, have the technology to siphon off the gas during the fermentation process. But smaller craft brewers don’t produce enough product to get their gas from fermentation. They purchase the CO2 from suppliers. And now Jackson Dome, one of the nation’s largest gas production hubs in Mississippi, is experiencing carbon ioxide problems, which one craft brewery called “a scary situation.”

“I’m in daily texts, communication with my supplier,” said Jacob Landry, the owner of Urban South Brewery in New Orleans told Fox Business.

Landry says he’s still able to get CO2, but he’s paying triple the price for it.

“This spike is having a big impact on our bottom line,” Landry said. “Our supplier is trying to source it wherever they can. We can’t get the quality we need out of our normal supply lines.”

John Raquet, the Chairman and Founder of Gas World, a leading news outlet covering the gas industry, explained that the dome is still producing CO2, but has elevated levels of other hydrocarbons that do not meet food and beverage standards for use.

And Landry explains that “if the CO2 does not meet beverage standards, it has the potential to create off flavors in their beer.”

In response to the demand for CO2 across the industry, an escalating number US breweries are looking at ways to mitigate this ‘scary situation.’  For Denizens Brewing, in Silver Spring, MD the situation has become challenging. It’s difficult to keep tanks filled and the brewery is now paying an extra for alternative sourcing.

According to the Boulder, CO-based trade organization, Brewers Association, the trade organization, carbon dioxide suppliers have already increased prices by about 25%, an increase that cuts deeply into craft brewers already tight margins.