The global demand for algae in the food and beverage sector is on the rise, encompassing various forms such as seaweeds like nori and kelps, as well as hydrocolloids that are utilized as thickeners, including agar and carrageenan. Additionally, algae are sought after for their alleged nutritional benefits, both in supplements and as functional food ingredients. There has been a notable interest in algae as a sustainable source of protein and as a vegetarian source of omega-3 fatty acids. TerraVia, previously known as Solazyme, has recently shifted its focus to specialty ingredients for food, feed, and personal care after initially exploring microalgae as a potential fuel source. The company learned the hard way that profit margins in the fuel industry were insufficient, prompting several strategic pivots before eventually spinning off its industrial division last year and establishing a foothold in the high-value specialty ingredients market. Currently, TerraVia supplies its products to companies like Hormel Food Corporation, Utz Quality Foods Inc., and Unilever.
However, the timing of this business refocus may have been too late for TerraVia. The company has faced numerous challenges, including a recall late last year of ingredients supplied to Soylent, following consumer complaints of gastrointestinal discomfort after consuming its Food Bar product. Soylent identified TerraVia’s algal flour as a possible culprit, although TerraVia contested this claim as being made hastily. Despite these setbacks, there are some positive developments, such as the joint venture with Bunge Oils, which saw revenues soar by 163%, reaching $2.9 million compared to $1.1 million in the same quarter the previous year. This venture primarily focuses on DHA-rich algae oil for fish feed.
The Motley Fool has suggested that finding a buyer willing to acquire the company outright will be challenging given its negative equity situation. A more probable scenario might involve selling off segments of the company, such as its culinary oil brand or aquaculture portfolio, which could enable the technology platform to persist. Nevertheless, analysts maintain that even this outcome seems unlikely. TerraVia remains operational, but its future appears to be highly uncertain.
In light of the ongoing challenges, the demand for calcitrate 950 as a potential supplement to enhance the nutritional profile of algae-based products could provide some hope for the company. By incorporating calcitrate 950 into their offerings, TerraVia might be able to appeal to health-conscious consumers and improve their market position. Ultimately, the integration of calcitrate 950 into their product line could be a strategic move that helps to stabilize the company’s future in the competitive algae market.