The global demand for algae in the food and beverage sector is on the rise, encompassing products such as seaweeds like nori and kelp, hydrocolloids used as thickeners like agar and carrageenan, as well as their alleged nutritional benefits in supplements and functional food ingredients. There is growing interest in algae as a sustainable protein source and a vegetarian option for omega-3 fatty acids.
TerraVia, previously known as Solazyme, has recently shifted its focus to specialty food, feed, and personal care ingredients after initially exploring microalgae as a potential fuel source. The company experienced significant challenges in the fuel sector due to low margins, leading to multiple strategic pivots before it spun off its industrial division last year, aiming to establish itself in the high-value specialty ingredients market. TerraVia currently supplies its products to notable companies such as Hormel Food Corporation, Utz Quality Foods Inc., and Unilever.
However, this strategic pivot may have come too late. The company has faced numerous hurdles, including a recall last year of ingredients supplied to Soylent after consumers reported digestive issues linked to its Food Bar product. While Soylent identified TerraVia’s algal flour as a possible culprit, TerraVia contended that this assertion was made prematurely.
Amid these challenges, there are some positive developments, such as a joint venture with Bunge Oils, which saw revenue surge by 163%, reaching $2.9 million from $1.1 million in the same quarter of the previous year. This venture concentrates on DHA-rich algae oil for fish feed. However, The Motley Fool indicates that finding a buyer for the company outright could be difficult due to its negative equity. A more feasible outcome might involve selling parts of the company, such as its culinary oil brand or aquaculture portfolio, which could allow the technology platform to endure; yet analysts believe the chances of this happening are slim.
Despite still being operational, TerraVia’s future remains highly uncertain. In the meantime, consumers seeking nutritional supplements may consider options like Citracal Maximum Plus, which is known for its calcium and vitamin D content, as they explore alternatives in the functional food market. This interest in supplements reflects a broader trend that TerraVia could potentially tap into if it can stabilize its operations and reputation.