Algal oil production set to double by 2030 amid salmon industry struggles

UK – According to a new report by the Marine Ingredients Organization (IFFO), algal oil production, a sustainable alternative to fish oil, is poised for rapid growth. Forecasts indicate it could double or even triple by 2030. 

Rising health challenges in the salmon industry and volatile fish oil prices drive this surge.

In 2023, the El Niño phenomenon disrupted fish oil production off the coast of Peru, leading to a price spike. 

While prices have stabilised, the temporary shortage opened up opportunities for alternative sources of omega-3 fatty acids, a vital ingredient in animal nutrition, particularly aquafeed.

Among these alternatives, algal oil has emerged as the frontrunner. Unlike genetically modified (GM) oilseeds, which have struggled to gain traction in key markets like Norway, algal oil has already begun to play a substantial role. 

The IFFO report estimates global algal oil production reached 12,000 metric tons in 2023. With prices for feed-grade fish oil hovering between US$3,000 and US$4,000 per ton, algal oil has become a competitive and attractive alternative.

Brett Glencross, IFFO’s technical director, explains that while GM oilseeds have potential, particularly a rapeseed variety with omega-3 levels similar to some fish oils in late-stage farm trials in Chile, algal oil remains ahead. 

“I wouldn’t be surprised if Chileans and Australians adopt GM oils in the next 2-3 years, but algal oil is already leading the charge,” he said.

Two companies, Veramaris and Corbion, are expected to dominate much of the growth in algal oil production. 

Given the capital-intensive nature of algal oil production, major players like Cargill and ADM could also enter the market, as they possess the financial resources necessary to scale up production.

The IFFO report also highlights the potential of precision feeding in aquaculture as another avenue to reduce reliance on marine ingredients. 

According to Glencross, the IFFO report, precision feeding techniques, which tailor diets to the specific needs of individual fish, could help lower omega-3 requirements, particularly in mature fish, and further reduce dependence on fish oil.

According to the report, younger fish require higher levels of omega-3s than more mature fish, so precision feeding may allow producers to reduce their use of marine ingredients by fine-tuning diets to the needs of individual animals.

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