The United Kingdom carbon dioxide (CO₂) market attained a volume of 725.8 KMT in 2024. The market is estimated to witness a CAGR of 1.5% during 2025-2034, reaching a volume of 840.5 KMT by 2034. This steady growth reflects the increasing importance of carbon dioxide across industries such as food and beverages, medical applications, and metal fabrication, as well as the rising adoption of sustainable and innovative CO₂ production techniques. The future of the United Kingdom carbon dioxide market is shaped by advancements in carbon capture technologies, evolving regulatory frameworks, and the UK’s industrial growth.

In this blog post, we will explore the key segments of the United Kingdom carbon dioxide market, assess its production dynamics, and highlight the role of leading companies that drive market development.

Key Market Segmentation by Source

Ammonia

Ammonia production is one of the main sources of CO₂ in the United Kingdom carbon dioxide market, as CO₂ is a by-product of ammonia manufacturing. This process is crucial for industries that require food-grade carbon dioxide, such as carbonated beverage production and food preservation. Companies like Yara International ASA and Tata Chemicals Europe Limited are advancing CO₂ recovery systems in ammonia plants to optimize CO₂ supply and enhance sustainability.

Ethyl Alcohol

Ethyl alcohol fermentation is another significant source of CO₂ in the UK. CO₂ is produced during fermentation processes, particularly in the beverage and biofuel industries. This bio-based CO₂ is considered more sustainable compared to fossil-fuel-derived CO₂. As demand for biofuels and alcoholic beverages increases, companies like BioCarbonics Ltd. are investing in bio-based CO₂ production methods, positioning themselves as leaders in sustainable CO₂ sourcing.

Substitute Natural Gas (SNG)

SNG processes also contribute to CO₂ production. With the UK’s commitment to energy transition efforts and alternative fuel sources, SNG has become an important supplementary source of carbon dioxide. Companies such as BOC Limited (Linde) are developing CO₂ recovery solutions from SNG to meet industrial demand while supporting cleaner energy production.

Market Segmentation by Production

Biological Production

Biological CO₂ production through fermentation and anaerobic digestion is gaining traction in the United Kingdom carbon dioxide market. These methods are more environmentally friendly and reduce the carbon footprint compared to traditional CO₂ production processes. Companies like Ensus UK Limited are leading in bioethanol production, which contributes significantly to the bio-based CO₂ sector.

Combustion Production

Combustion remains a primary method for CO₂ production, especially in industrial and energy sectors. However, combustion processes are under scrutiny due to their environmental impact. Companies such as Air Liquide UK Ltd and Air Products PLC are at the forefront of integrating carbon capture, utilization, and storage (CCUS) technologies into combustion CO₂ production, making it more sustainable and reducing overall emissions.

Key Market Segmentation by End Use

Food and Beverages

The food and beverage industry is the largest consumer of CO₂ in the United Kingdom carbon dioxide market. CO₂ is used extensively in carbonated beverages, food packaging, and preservation. As the UK’s food and beverage sector expands, the demand for food-grade CO₂ is expected to rise, creating opportunities for companies like BioCarbonics Ltd. and BOC Limited (Linde) to provide sustainable CO₂ solutions.

Oil and Gas

In the oil and gas sector, CO₂ is primarily used for enhanced oil recovery (EOR). While the transition to renewable energy is decreasing overall demand for CO₂ in this sector, companies such as Air Products PLC continue to supply CO₂ for EOR applications, maintaining their role in this industry during the transition to greener energy sources.

Medical Applications

CO₂ is essential in medical applications, including surgeries, anesthesia, and respiratory therapies. The healthcare sector’s growing demand for medical-grade CO₂ creates opportunities for suppliers like Nippon Gases and Progases (UK) Ltd, who are committed to meeting the rigorous safety and quality standards required for medical CO₂ use.

Metal Fabrication

In the metal fabrication industry, CO₂ is crucial for welding, cutting, and other processes. As manufacturing activities in the UK increase, particularly in the automotive and construction sectors, the demand for CO₂ in metal fabrication is set to rise. Companies like Tata Chemicals Europe Limited and Air Liquide UK Ltd will continue to play a key role in supplying CO₂ for these industrial applications.

Other Applications

Additional CO₂ applications include water treatment, chemical production, and fire suppression. These diverse applications help maintain steady demand for CO₂ across a variety of industries, making the United Kingdom carbon dioxide market essential to the nation’s industrial base.

Market Dynamics

SWOT Analysis

Strengths

• The United Kingdom carbon dioxide market benefits from well-established production infrastructure and diverse end-use applications across industries.
• Strong industrial presence with robust demand from sectors such as food and beverages, healthcare, and manufacturing.
• Ongoing investments in sustainability and CO₂ recovery technologies.

Weaknesses

• Environmental challenges related to emissions from traditional CO₂ production methods.
• Dependency on limited sources of CO₂ such as ammonia, ethyl alcohol, and SNG.

Opportunities

• Advancements in carbon capture and utilization technologies present opportunities for reducing emissions.
• Bio-based CO₂ production methods offer cleaner alternatives and meet the growing sustainability demands of industries.
• Increasing focus on circular economy practices and waste CO₂ recycling for industrial applications.

Threats

• Stringent regulatory restrictions on emissions, particularly in combustion-based CO₂ production.
• Competition from alternative gases and emerging substitutes for CO₂ in specific applications.
• Supply chain disruptions due to geopolitical or economic factors.

Porter’s Five Forces Analysis

• Threat of New Entrants: The United Kingdom carbon dioxide market has high capital investment and regulatory requirements, acting as barriers to entry.
• Bargaining Power of Suppliers: Limited CO₂ sources and the reliance on a few suppliers gives suppliers a moderate level of bargaining power.
• Bargaining Power of Buyers: Buyers have access to multiple suppliers but are concerned with the consistency and quality of CO₂ delivery.
• Threat of Substitutes: While there are emerging alternatives for CO₂, such as alternative gases and recycling technologies, CO₂ remains irreplaceable in many industrial applications.
• Industry Rivalry: Intense competition among established companies like BOC Limited (Linde), Air Liquide UK Ltd, and Air Products PLC drives innovation and price competitiveness.

Regional Insights

Urban areas such as London, Birmingham, and Manchester are key demand drivers for CO₂ in the United Kingdom carbon dioxide market, owing to their dense industrial concentration. However, rural regions are seeing growth as industries expand beyond metropolitan areas. Companies like BOC Limited (Linde) and Air Liquide UK Ltd are optimizing supply chain management to balance regional demand and production effectively.

Competitive Landscape

The United Kingdom carbon dioxide market is competitive, with several key players investing in innovation and sustainability. Leading companies in the market include:

• Ensus UK Limited: Focuses on bioethanol production, contributing to bio-based CO₂ generation.
• BioCarbonics Ltd.: Specializes in providing bio-based CO₂ solutions for the food and beverage industry.
• Tata Chemicals Europe Limited: Supplies industrial-grade CO₂ for metal fabrication and other applications.
• Yara International ASA: Enhances CO₂ recovery systems in ammonia plants.
• Air Products PLC: Invests in carbon capture technologies and sustainable CO₂ production methods.
• BOC Limited (Linde): Offers diverse CO₂ solutions for industrial and medical applications.
• Air Liquide UK Ltd: Pioneers in sustainable CO₂ production and distribution technologies.
• Nippon Gases: Provides medical-grade CO₂ for healthcare applications.
• Progases (UK) Ltd: Meets specific CO₂ requirements across various industries.

These companies are focusing on sustainability and technology-driven solutions to stay competitive in the United Kingdom carbon dioxide market.