Microalgae-based Aquafeed Market Size, Share & COVID-19 Impact Analysis, By Species (Spirulina, Chlorella, Nannochloropsis, Isochrysis, and Others), By Aquatic Animal (Fish, Mollusks, Crustaceans, and Others) and Regional Forecast, 2023-2030

The microalgae-based aquafeed market size was valued at USD 239.70 million in 2022 and is projected to grow from USD 257.20 million in 2023 to USD 433.08 million by 2030, exhibiting a CAGR of 7.73% during the forecast period. Asia Pacific dominated the microalgae-based aqaufeed market with a market share of 72.05% in 2022. Moreover, the microalgae-based aquafeed market size in the U.S. is projected to grow significantly, reaching an estimated value of USD 27.95 million by 2032, driven by significant import of seaweed and algae for processing and raw material production, which are used in aquafeed production.

Aquaculture has been one of the fastest-growing sectors for over three decades, which contributes a notable share in achieving global food security. According to the report released by the State of World Fisheries and Aquaculture 2022, aquaculture production is estimated to reach 109 million tons by 2030 and cross 140 million tons by 2050 under the usual scenario.

To meet the aquaculture demand, fishery associations are getting actively involved in R&D activities to cultivate new species. An expanding list of cultivable species and genetic improvements of existing cultivable species is predicted to positively influence the demand for aquafeed products globally in the coming years.

Numerous factors, such as technological improvements, educational activities to adopt novel methods in production phases, and high-quality feedstuff, are closely related to the global growth of the aquaculture industry. As compared to all other factors, aquafeed is one of the vital parts of the industry. Feed is the single, most considerable operational expense in aquaculture, which costs between 70 and 80%. The cost of the feed will determine the profitability and sustainability of this agribusiness activity. Traditionally, feeds were reliant on the use of marine ingredient resources. However, the increasing demand for algae-based fish food will not be able to meet the raw material requirements. Thus, feed manufacturers are focusing on alternative feed resources for aquaculture, mainly derived from terrestrial-animal or plant-based sources.

COVID-19 IMPACT

Disruption in Algae Supply Chain Amid Pandemic Hampered Market Growth

The COVID-19 pandemic had far-reaching implications for the global economy. The COVID-19 pandemic significantly impacted the aquafeed industry. As several countries banned manufacturing operations of non-essential industries, aquafeed manufacturers were placed in a difficult situation on how to maintain their production of fish and availability of aquatic feed and meet growing market needs.

The strict lockdown restrictions imposed by governments in their respective countries worldwide have impacted the food and feed industry detrimentally. The movement of goods from one place to another was restricted during the pandemic, causing delays and a shortage in the availability of aquafeed. Although feed suppliers were included in the essential goods list in Spain, Italy, Belgium, and several other European countries, they were not included among essential goods in many other countries, leading to significant supply chain disruption. Thus, feed associations, including aquafeed providers, such as the European Feed Manufacturers' Federation (FEFAC) and others, appealed to the European Union Commission to include feed products in the list of essential goods.

Some of the farmers had to keep their fish in their water reservoirs for longer periods, driving up production costs. The global supply chain disruption prevented the farmers from selling their fish, emptying their water reservoirs, and starting their new fish farming cycle. For instance, Salmon farmers in South America reduced the production of salmon fish due to global supply chain disruption. Therefore, with the decline in fish production, the demand for microalgae-based aquafeed for such fish also declined.

Microalgae-based Aquafeed Market Trends

Adoption of New Technologies in Microalgae-Based Feed Production is Trending in the Market 

 Technological advancement is the new trend in the market. New production methods, such as photobioreactors and closed systems, are increasing the efficiency and sustainability of microalgae cultivation. These new technologies help to improve the nutritional content and quality of microalgae-based aquafeed.

Vaxa is an international technology startup developing new technologies for microalgae production. The company developed a revolutionary new technology platform that perfected the cultivation of omega-3-rich microalgae in 2023. The EIT Food project used Vaxa's proprietary new cultivation technology to develop and optimize a microalgae production process. The microalgae production unit was modular and installed in a state-of-the-art, biologically secure facility near the Hellisheidy geothermal power plant.

Microalgae growth was supported by the plant's natural yields, including artificial light, cool and hot sea water, and renewable energy to power the production process, including the production of carbon dioxide. The development and incorporation of technologies that can bring more transparency to the microalgae aquafeed market can propel the product demand for those who are environment-conscious and prefer to use sustainable and eco-friendly products.

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Microalgae-based Aquafeed Market Growth Factors

Health Boosting Properties of Microalgae Feed in Aquatic Animals to Support Market Growth

Microalgae are photosynthetic microorganisms that consume atmospheric carbon dioxide (CO2) and light energy to produce a variety of lipids, carbohydrates, protein, and microelements, including minerals, vitamins, flavonoids, polyphenols, and carotenoids that are beneficial for aquatic animals. Due to the presence of high protein levels in many algal species, microalgae biomass is being added into aqua feed to replace conventional protein sources.

The increasing demand for seafood led to an increase in the demand for microalgae-based aquafeed in the market. Microalgae oil usage was invented decades ago; however, in recent years, microalgae-based aquafeeds have been tested and experimented with using different parameters. Freshwater microalgae are filled with high levels of protein, lipids, and carbohydrates essential for fish growth. The consumer wants to eat good, healthy seafood, and the microalgae feed helps to provide nutritional benefits to aquatic animals that will further provide better quality seafood to the customer, which may drive the microalgae-based aquafeed market growth.

Microalgae are generally single-celled organisms that are rich in carbohydrates, proteins, enzymes, and fiber. Moreover, different aquatic animals require nutrients from varied microalgae species at different growth stages. For example, microalgae rich in Eicosapentaenoic Acid (EPA) or Docosahexaenoic Acid (DHA) (Chaetoceros calcitrans and Isochrysis galbana) are usually fed to marine mollusks in the early development stage. In the early stage, it provides nutrient benefits to aquaculture animals in the form of lipids. Therefore, manufacturers are willing to purchase this new product.

The components of microalgae biomass are proteins with essential amino acids, lipids with Polyunsaturated Fatty Acids (PUFA), carbohydrates, pigments, and other bioactive compounds. Thus, microalgae can be used as an essential, viable, and alternative feed ingredient in aquaculture feed. In recent times, live algae culture, whole algae, and Lipid-Extracted Algae (LEA) have been tested in fish feed for growth, physiological activity, and nutritional value. Due to their high nutritional and functional value, microalgae have a high potential for application in the feed industry, for being incorporated as a feed supplement and enhancing animal performance.

Environmental Sustainability of Microalgae Aquafeed to Fuel Market Growth

The increasing focus on sustainable and environmentally friendly aquaculture practices is one of the crucial drivers of the market. The aquaculture industry has been under increasing scrutiny due to its environmental impact, including the use of wild fish stocks for feed, the release of nutrients and pollutants into the environment, and the potential for disease outbreaks. Microalgae-based aquafeed is a sustainable and environmentally friendly alternative to traditional fish meal and soy-based feed. It can help to reduce the pressure on wild fish stocks and limit the environmental impact of aquaculture operations; therefore, the demand for this aquafeed from both producers and consumers who are concerned about the sustainability of the aquaculture industry is constantly increasing.

Microalgae have additional appeal as a food source for farmed fish due to their flexible water requirements. Many species can be grown in wastewater or seawater, reducing the impact on drinking water supplies for human consumption. In open systems, evaporation remains a significant problem, and this is especially true for saline systems. Once the water evaporates, it must be replaced to maintain an optimal balance between suspended salt and water. Species that are more tolerant of increased salinity can alleviate such problems. Reusing the cultivation medium after biomass harvesting reduces water usage and makes full use of the nutrients remaining in the water in the Photobioreactors (PBR), thereby contributing to economic sustainability.

RESTRAINING FACTORS

Challenges in Microalgae Harvesting and Processing Affects Market Growth

The market faces several challenges, and one of the challenges is microalgae harvesting and processing. Interactions between microalgae and the microbiome are considered vital to health and disease in aquatic environments. It requires significant investment in equipment infrastructure and technology at the time of harvesting and production of microalgae, which may hamper market growth. The production of microalgae-based aquafeed also requires large amounts of energy and water, which add to the cost of the production; therefore, it is often more expensive than traditional fish meal and soybean-based feed, which can be a hindrance for many producers to adopt the techniques and also impact the microalgae-based feed production.

Most aquafeeds replace fishmeal with microalgae biomass. Microalgae grown in a culture must be harvested, dried, and humidity-controlled before being used to produce algal biomass-rich fish feed pellets. Centrifugation, sedimentation, and filtration are the processes used to collect floating algae cells in the culture medium. The collection of algal biomass accounts for 30% of the cost of microalgae production. Additionally, aluminum is incorporated into the biomass during flocculation harvesting, making microalgae-based aquafeeds undesirable and increasing the production cost, which may affect market growth.

Microalgae-based Aquafeed Market Segmentation Analysis

By Species Analysis

Increase in Spirulina Production Boosts Spirulina Segment Growth

The species segment is divided into spirulina, chlorella, nannochloropsis, isochrysis, and others.

The spirulina segment holds a significant share in the global market owing to the higher availability and extensive production and dominates the total market share. Furthermore, spirulina is one of the most concentrated sources of fatty acids, amino acids, and vitamins, which makes it idle for multiple fish species, and also shrimps, which have the highest share in aquaculture production.

However, limited production of chlorella, nannochloropsis, isochrvsis, and other green microalgae causes limited availability of other species, resulting in the restraining of growth. Nannochloropsis is unicellular algae that is spherical or oblong, measuring 2-5 microns in diameter, which is induced with photosynthetic pigments, protein, and polyunsaturated fatty acids (including omega-3 fatty acids), and it grows at a rapid scale under typical culture conditions making this microalgae popular for use in aquaculture feed and dietary supplements, as well as a potential candidate for biofuels.

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By Aquatic Animal Analysis

Robust Demand for Various Fish Types Boosts the Fish Segment's Commanding Share in the Market

The aquatic animal segment is divided into fish, crustaceans, mollusks, and others.

The fish segment holds a significant share of the global market owing to the higher consumption rate of various types of fish, which in turn boosts the demand for feed, including microalgae-based feed.

The higher demand among consumers and limitations of wild capture of shrimps have fueled aquaculture/shrimp farming globally, resulting in a rapid increase in demand for shrimp feed. Shrimps require a significant amount of feed with specific requirements, which has increased demand for high-quality feed requirements. Furthermore, the increasing shrimp cost has resulted in reduced profit margins for farmers, which has made shrimp growers more inclined toward more sustainable feed alternatives. These changing trends are going to be significant factors in fueling the demand for microalgae-based aquafeed for crustaceans.

REGIONAL INSIGHTS

The market is analyzed across North America, Europe, Asia Pacific, South America, and Middle East & Africa.

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Asia Pacific holds the largest microalgae-based aquafeed market share, given that the region has the largest aquaculture industry. Asia Pacific includes China, South Korea, Japan, and others, which consume a significant amount of seafood, thus resulting in a higher demand for seafood in the region.

For instance, as per the Food and Agriculture Organization, Asia Pacific has displayed a rapid growth in demand for seafood owing to the increasing population in India, China, Bangladesh, and others. In addition, the region is the leader in terms of aquaculture production and holds a monopolistic share in global aquaculture production. Thus making it one of the major exporters of aquaculture products.

The higher aquaculture production results in higher demand for aquafeed in the region. For instance, as per the Food and Agriculture Organization, in 2021, the region accounted for 90.51% share of global aquaculture production, thus having a higher demand for aquafeed in the region.

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Europe has some of the major seafood-producing countries, such as Germany, France, Italy, Spain, Sweden, Norway, the U.K., and others. With the production, consumption of seafood is also high in Europe; however, the consumption patterns vary greatly with each country. For instance, in 2019, as per the European Commission, the 28 countries of the European Union accounted for an average of 23.97 kg of consumption per capita, from which Portugal was the highest with 59.9 kg per capita, and Czechia with around 6kg per capita. However, the region is one of the lowest aquaculture producers globally, with a global share of less than 2.68%. Furthermore, the region has some of the primary feed ingredient and aquafeed manufacturers, such as Biomar Group, Aller Aqua Group, Cargill Inc., and others, resulting in a significant share in the import of seaweed and algae. Thus, the region has a significant growth rate with increasing demand for sustainable and economical aquafeed.

North America is one of the significant seafood-consuming regions owing to the higher consumption rate among U.S. citizens, which has a substantial share in North America's seafood consumption. For instance, in 2021, as per the National Fisheries Institute (NFI), U.S. citizens had a record consumption of 9.29kg per capita of seafood, which is 0.68kg more than in 2020. However, the region is more inclined toward seafood imports owing to the limited aquaculture and wild fishery production. For instance, as per the Food and Agriculture Organization, in 2021, the region accounted for just 0.73% of global aquaculture production, thus limiting the growth of algae-based aquafeed in the region. However, the region does have a significant import of seaweed and algae for processing and raw material production, which are used in aquafeed production. Further, the considerable presence of ingredient companies, such as Alltech Inc., Archer Daniels Midland Co., and others in the U.S., Canada, and Mexico, is also boosting the algae import in the region.

South America consists of Brazil, Argentina, Chile, and other countries, where seafood consumption is less than in Europe, Asia, and other regions. The region is not very inclined toward seafood consumption as compared to Europe and Asia Pacific. For instance, as per the Food and Agriculture Organization, Guyana and Peru are the only prominent seafood-consuming countries in the region, with an average consumption of 25kg per capita in both countries, whereas the regional average is less than 10kg per capita. Thus limiting the demand for the aquafeed market in the region.

The Middle East & Africa have a higher seafood consumption owing to the presence of countries, such as the UAE and Oman. For instance, as per the Food and Agriculture Organization, the UAE. and Oman have the highest seafood consumption levels compared to other countries globally. The region is more inclined toward capture and not aquaculture, which limits the demand for aquafeed. However, the region has seen significant growth in the import of seaweed and algae for processing and ingredient production, which are used in aquafeed production, owing to the expansion of feed manufacturing in the region. For instance, in August 2023, Berg + Schmidt announced its expansion in the Middle East with the launch of its new subsidiary.

List of Key Companies in Microalgae-based Aquafeed Market

Key Players Focus on Adapting New Technologies to Stay Ahead of Market Competition

This market is an emerging market that has become popular globally with few dominant players. The rapidly developing aquaculture industry, the rising need for low-cost alternatives to fish oil, and increasing sustainable microalgae feed applications form significant opportunities for the market. With innovations taking place rapidly all over the globe, demand for customized microalgae saltwater tanks has been gaining traction over the last few years.      

The prominent players in the market focus on partnerships, mergers/acquisitions, and certifications to expand their product lineup and strengthen their microalgae-based aquafeed business. Therefore, players actively invested in strategic mergers and acquisitions to stay ahead in the algae-based product market. For instance, in May 2019, Solabia Group acquired Algatech Ltd., one of the leading innovators of microalgae. The acquisition accelerated the growth of Solabia’s product portfolio and helped develop new algae-based products for various industries, including aquafeed.

List of Key Companies Profiled:

• A4F Algae for future (Portugal)


• Algalimento SL (Spain)


• Cellana Inc. (U.S.)


• Corbion N.V. (Netherlands)


• Evergen Resources (Indonesia)


• Greentech Group (France)


• Kessler Zoologiegrosshandel GmbH & Co. KG (Germany)


• Koninklijke DSM N.V. (Netherlands)


• Solabia Group (France)


• The Archer-Daniels-Midland Company (U.S.)

KEY INDUSTRY DEVELOPMENTS:

• June 2023: A4F announced a partnership with the newly funded Horizon Europe project INOAQUA. As part of a consortium of 17 partners, A4F will lead a project that focuses on sustainable aquaculture practices. In line with the European Green Deal's farm-to-fork strategy, this project aims to unlock the potential of algae as an environmentally friendly food. The aim is to improve the sustainability and competitiveness of the aquaculture sector and lead the European algae industry to a solid future. This partnership will further help the company to increase its presence in the European market.


• September 2023: Corbion, the global market leader in algae-based feed ingredients, launched its new AlgaPrime DHA P3, a high-performance omega-3 ingredient. The new product helps pet food manufacturers enhance the nutritional profile of their products and boost DHA levels, reducing dependency on marine-based resources. The new product is also used in the aquaculture industry.


• June 2023: Green Aqua, a Portuguese company operating in the aquaculture industry, entered into a strategic partnership with Algikey to produce and commercialize algae products for the aquaculture market. This new partnership is aimed at expanding the production capacity and increasing production in line with the market demand.


• June 2022: TransAlgae, an Israeli startup operating in microalgae production, developed a microalgae-based innovative platform for disease treatment of aquaculture species and for delivering the vaccines orally to the species.


• October 2020: Allmicroalgae (Greentech Group) doubled the production of its algae-based ingredients by installing a second fermenter. The installation of a second unit increased the current capabilities by 50% and doubled the volume. The company also planned to expand its capabilities to produce specific species of microalgae, such as Chlorella vulgaris Tetraselmis sp., and others for the feed industry.

REPORT COVERAGE

An Infographic Representation of Microalgae-based Aquafeed Market

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The report provides detailed market analysis and focuses on key aspects such as leading companies, species, aquatic animals, and pricing by different species. Besides, the report offers insights into the market trends and highlights key industry developments. In addition to the factors above, the report encompasses several factors that contributed to the growth of the market in recent years.

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