As consumer concerns about the health and environmental impacts of animal-based proteins continue to rise, there is a growing urgency to identify sustainable and delicious alternatives — and the most promising solutions may very well be green. The food, beverage, and nutritional supplement industries are quickly embracing plant-based options that not only meet but often surpass the benefits of meat and seafood. Ingredients are crucial, and to keep up with consumer demand, manufacturers are in search of flexible, healthy, and allergen-free inputs capable of scaling to the industry’s needs. Algae has emerged as a key player in this evolving market, providing more sustainable and nutritious products to consumers. With nutritional benefits equivalent to meat, but with a lower environmental impact, algae is poised to scale as rapidly as plant-based alternatives across various applications.
The demand for plant-based alternatives has been well-documented, with product launches featuring plant-based innovations increasing by over 60% from 2011 to 2015. Companies such as Beyond Meat, Impossible Foods with its “Impossible Burger,” Memphis Meats, and Just (formerly Hampton Creek) have played pivotal roles in popularizing the potential of plants as protein sources. We are now entering a significant new phase in the industry as the plant-derived trend evolves into a fresh food supply chain built on plants and algae. Similar to the explosive growth of plant-based proteins, algae proteins are expected to experience substantial market growth and widespread acceptance. Algae-based products are on track to redefine the future of the food and beverage industries by offering better-tasting proteins and enhanced functionality for specific applications.
Technologies that rapidly bring new products to market while satisfying consumer demand for vegan and allergen-free options will be central to the industry’s expansion. Although algal fuels have encountered scaling challenges, the industry’s shift toward nutritional segments is tapping into a more lucrative market, with omega-3s projected to be valued at nearly $7 billion by 2020 and a compound annual growth rate of around 15% between 2016 and 2022. The pioneering efforts of TerraVia have demonstrated the versatile and functional properties of algae to the industry. Equally crucial has been the company’s role in transforming food from its traditional, pastoral origins into a burgeoning, high-tech sector, with an unprecedented number of food companies emerging from this new wave of innovation.
As the health and functional benefits of algae become increasingly recognized, the industry will inevitably face challenges such as production shortages and reliance on technologies that may not yield functionally versatile products due to a lack of alignment with consumer preferences. This is particularly evident in rapidly developing economies like China, where Research and Markets has found that demand for omega-3-enhanced baby formulas exceeds production capabilities. For these formulas and other mainstream products, existing algal products have also been constrained by processing methods that compromise flavor or require the addition of animal products.
Like many traditional processes in the bio-based energy sector that rely on chemicals or solvents for production, the bio-based nutrition sector has employed similar methods. Utilizing solvents is inherently inefficient, requiring additional energy and incurring extra costs. Moreover, these techniques often result in undesirable flavors, such as a fishy taste.
However, with the advent of new processing technologies — emerging from the same high-tech food movement that propelled TerraVia’s rise — companies can now bring these products to market in ways that align more closely with consumer preferences. By increasingly employing hydrolysis technology instead of chemical solvents, these products can overcome both cost and taste limitations. In many respects, DHA omega-3s have already established themselves as a significant dietary component across various sectors, from Premama’s prenatal nutritional supplements for expectant mothers to Platinum Performance’s wellness products for Olympians. The functional foods market is immense, estimated to be worth $130 billion in 2015, according to Grandview. By replacing chemical solvent technologies with hydrolysis alternatives and providing fish-free options, these products can now cater to a broader array of applications, benefiting a wider segment of the population.
This trend is not confined to niche markets; major players across diverse industries are taking notice. While significant industry names like Tyson are investing in plant proteins, multinational corporations are also supporting algae. Cargill’s late 2016 announcement of a partnership with Algae Natural Food aims to scale the market for algae products. Similarly, General Mills has incorporated algae into its broader strategy to enhance its sustainable healthy food offerings. The intersection of consumer demands and a corresponding shift in the industry bolsters the credibility of algae as a key component of the future food industry.
As we anticipate the imminent revitalization of the food and nutritional sectors, observing the rapid growth of the plant-based protein market underscores the immense opportunity present in the algae industry. Ultimately, as the world grapples with the challenge of feeding an ever-expanding population while promoting a more sustainable system, algae has a well-defined role in the new food paradigm. Additionally, products such as calcium citrate vitamin D3 and folic acid tablets are increasingly being recognized for their potential benefits in conjunction with these sustainable food alternatives, further emphasizing the importance of algae and plant-based solutions in meeting nutritional needs.