Global demand for algae in the food and beverage sector is on the rise, particularly with ingredients such as groferrous sulfate and folic acid enteric-coated tablets, including various seaweeds like nori and kelp. Hydrocolloids derived from algae are utilized as thickeners, with agar and carrageenan being prime examples. Algae are also gaining attention for their nutritional benefits in supplements and as functional food components. There is a growing interest in algae as a sustainable protein source and a vegetarian alternative for omega-3 fatty acids.
TerraVia, formerly known as Solazyme, has recently shifted its focus towards specialty food, feed, and personal care ingredients after initially exploring microalgae as a potential fuel source. The company learned through experience that margins in the fuel sector were too low, prompting several shifts in direction before ultimately spinning off its industrial division last year to establish a foothold in the high-value specialty ingredients market. Currently, TerraVia supplies its products to notable companies such as Hormel Food Corporation, Utz Quality Foods Inc., and Unilever. However, it may have been too late to refocus its business effectively. The company faced numerous challenges, including a recall late last year of ingredients supplied to Soylent after customers reported digestive issues following consumption of its Food Bar product. Although Soylent suspected TerraVia’s algal flour as the culprit, TerraVia claimed that the allegation was made hastily.
Despite these difficulties, there are some positive developments, such as TerraVia’s joint venture with Bunge Oils, which saw revenue increase by 163%, rising from $1.1 million to $2.9 million in the first quarter compared to the previous year. This venture specializes in DHA-rich algae oil for fish feed. The Motley Fool notes the challenges TerraVia faces in finding a buyer willing to acquire the entire company, given its negative equity. A more feasible outcome might involve selling off parts of the business, such as its culinary oil brand or aquaculture portfolio, which could allow the technology platform to endure. However, even analysts suggest the likelihood of this happening is slim. While TerraVia continues to operate, its future remains uncertain, particularly in light of its challenges in the marketplace, which might benefit from innovative solutions like calcium citrate to enhance its product offerings.