The global algae omega-3 ingredients market size was valued at USD 975.14 million in 2022. It is estimated to reach USD 2,966.90 million by 2031, growing at a CAGR of 13.16% during the forecast period (2023–2031). The recent demand for convenient and highly efficient ultra-high concentrates with eicosapentaenoic acid (EPA) and docosahexaenoic acid (DHA) concentrations is augmenting the demand for algae omega-3 ingredients worldwide.
Omega-3 oils are fundamentally unsaturated fats with numerous health advantages, including cardiovascular, eye, and mental health, to promote diet, baby nutrition, substantial livelihoods and beverages, and pharmaceutical and clinical nutrition. Algae is the common name for a group of photosynthetic eukaryotes consisting of organisms affixed to the bottom of seas, rivers, and lakes, also known as seaweeds. These organisms range from microscopic unicellular microalgae to larger multicellular forms that typically float freely.
In dairy products, non-dairy supplements, spirulina and chlorella products, shellfish, marine seasonings, fish oil, supplements containing omega-3 fatty acids, and turquoise seaweed, omega-3 ingredients derived from algae can be found. Some algae are protein-rich and can be utilized as culinary ingredients. Omega-3 constituents derived from algae have a high nutritional value regarding protein content, amino acid quality, and nutritional bioavailability.
|Market Size||USD 2,966.90 million by 2031|
|Fastest Growing Market||Asia Pacific|
|Largest Market||North America|
|Report Coverage||Revenue Forecast, Competitive Landscape, Growth Factors, Environment & Regulatory Landscape and Trends|
Algae omega-3 concentrates are highly purified oils supplying merely the desired fatty acids, EPA, and DHA in a convenient, small dosage form. This enables a convenient intake of significant quantities and specific use conditions. High-concentrate fish oils, high-purity krill oils, and purified algal oils are expected to increase in popularity as supplement consumers are gaining awareness regarding high concentrates, and the demand for higher omega-3 dosages has increased.
Moreover, in countries and regions like the United States, China, and Europe, consumers of supplements have been shifting away from refined anchovy oils and inclining toward omega ingredients of higher concentration. Further, a high concentration of algae omega-3-based ingredients allows manufacturers to free up space in their products and to develop formulations with other active ingredients. Smaller capsules and soft gel sizes can deliver a dose of concentrate algae omega-3, which the dietary and pharmaceutical manufacturers highly recognize. This has been accelerating the sales for the market studied.
The surging demand for infant formula products in developing countries primarily propels the market. DHA and EPA are essential for infants' cerebral development and immune system strength. DHA has well-established legal limits for inclusion in infant formula products, as outlined by various regulations and WHO recommendations.
According to a Norwegian study, omega-3 benefits children's brains and improves their problem-solving skills. Recent research studies indicate that high levels of DHA in infant formula or breast milk can favor the development of pre-term infants, such as a height increase. In countries like China, where both the adult and infant populations are increasing, the demand for infant nutrition and baby food is consistently surging. Parents who lead hectic lives and have less time to prepare meals are driving their demand for infant formulas fortified with omega-3.
Producers of omega-3 components derived from algae have challenges in the form of elevated production costs relative to their counterparts utilizing fish oil, intense competition in pricing, and a notable degree of price sensitivity within the food industries. These factors collectively impede the expansion of the industry. As per the Global Seafood Alliance, the cost per kilogram of algae is excessively high due to the demand for labor, water, and energy; in February 2020, it was valued between EUR 300 and EUR 900 per kilogram. Most algae omega-3 ingredient manufacturers face challenges based on the high price. According to the Good Food Institute, a non-profit organization, cost is a leading barrier to including omega-3 ingredients in products, especially as companies scale.
The market studied is in a state of rapid transformation due to technological innovations and converging trends. With a growing awareness of humanity's impact on the planet, consumers are shifting toward plant-based diets that provide sustainable solutions that enhance the state of the environment. In favor of this, market leaders are advancing their product portfolios to cater to the soaring demands. For instance, Koninklijke DSM NV offers life's™ OMEGA, a plant-based alternative to fish oil that contains at least 500mg/g of EPA and DHA in triglyceride form and is obtained from a vegetarian source using a sustainable method.
Globally, there is a rapid increase in demand for omega-3 algal oils. Oil quality and the environment are compromised by using high temperatures and compounds in conventional oil production techniques. Therefore, alternative ecological technologies for extracting oils from aquatic sources have been investigated. Such advancements are expected to create opportunities for market growth.
Based on region, the global algae omega-3 ingredients market is bifurcated into North America, Europe, Asia-Pacific, South America, and the Middle East and Africa.
North America is the most significant global algae omega-3 ingredients market shareholder and is anticipated to exhibit a CAGR of 11.92% during the forecast period. The United States holds the greatest share of the global market for algae omega-3 ingredients in North America. This is due to the increased ingestion of omega-3 supplements, fortified foods, and rising awareness of the health benefits of omega-3. The domestic expansion of the leading companies and the frequent introduction of products with improved formulations have also fuelled market expansion in the region. Docosahexaenoic acid (DHA) is a significant component of neonatal nutrition in the United States. Nearly every brand of infant nutrition formula in the country includes DHA as an ingredient, which raises the cost of formula and contributes to the expansion of the market for phytoplankton omega-3 ingredients in the country. Enfamil, a U.S.-based company, offers Enfagrow A+ Stage 4 Nutritional Milk Powder containing DHA and other essential prebiotics and micronutrients. In addition, with the continued expansion of the "plant-based revolution" in the United States, consumers are constantly searching for healthier and more sustainable alternatives, which include supplements. All these factors boost regional market growth.
Asia-Pacific is predicted to exhibit a CAGR of 15.27% over the forecast period. A strong manufacturing base, a growing middle-class population, increasing disposable income, and rising health-consciousness among consumers are fueling the demand for products with Omega-3 ingredients in the Asia-Pacific, thereby stimulating investments by manufacturers in producing Omega-3-rich ingredients. Moreover, urbanization has contributed to the growth of health consciousness in nations like India, prompting numerous health-focused startups to enter the Asia-Pacific market. Examples of such startups include WOW Science and Oziva, which have successfully tapped into the flourishing consumer demand for functional foods and supplements. This trend has facilitated the country's growing utilization of algal Omega-3 ingredients. Due to the huge proportion of vegetarian consumers in India, algal oil as a source of Omega-3 components is also expected to rise during the forecast period.
The European region has witnessed rapid traction around preventive healthcare approaches to gain a healthy and active lifestyle. The prevalence of this trend was strongly boosted by the COVID-19 pandemic, wherein a wider population consumed immunity-boosting and heart health-supporting supplements, including omega-3 supplements. According to a survey conducted by the Health Food Manufacturers' Association (HFMA), the UK has 20 million daily supplement consumers, a 19% rise compared to the survey undertaken in 2019. Therefore, the growing acceptance of dietary supplements in the country is expected to favor the growth of algae omega-3 ingredients.
Similarly, in May 2021, Biotechnology firm AlgaeCytes started building its first commercial algal eicosapentaenoic acid (EPA) plant in Germany. The company further announced that its EPA oil could be used in the nutraceutical, pharmaceutical, and food sectors. Therefore, increasing algal oil production and expanding algal oil application in the country drive market growth.
Brazil remains the largest consumer in the omega-3 market in the South American region, holding great potential for functional food and beverage products incorporated with active ingredients, such as EPA and DHA ingredients. This demand is because of the growing awareness among the Brazilian population and the rising number of investments in the industry. Thus, the manufacturers are expanding their omega ingredients portfolio with increased functionality and a wide application range. For instance, in March 2020, Wiley Companies launched omega-3 concentrates powder across Latin America, including Brazil. Its Marine Stewardship Council (MCS) certified omega-3 concentrate powder was designed for dietary supplements, food, and beverages. Brazil's growing anxiety and depression rates have raised awareness of health issues, raising demand for dietary supplements and other health-related goods. Manufacturers are taking advantage of this opportunity, thus driving the market by utilizing algae ingredients in pharma and clinical applications.
The global algae omega-3 ingredients market is segmented by type and application.
Based on type, the global algae omega-3 ingredients market is segmented into eicosapentaenoic acid (EPA), docosahexaenoic acid (DHA), and EPA/DHA.
The docosahexaenoic acid (DHA) segment is the largest revenue contributor to the market and is expected to exhibit a CAGR of 12.94% over the forecast period. As an essential building element for developing and maturing an infant's brain and retina, DHA is primarily driven by the increasing demand for infant formulae and nutritional products to improve children's health. It is derived predominantly from fish and phytoplankton oils. It is widely utilized in fortified foods and dietary supplements to treat coronary artery disease (CAD), dementia, Type 2 diabetes, and attention deficit hyperactivity disorder (ADHD).
In addition, the positive effects of DHA on healthy aging have also led to its successful incorporation into geriatric nutrition products. The industry is expanding due to the rising number of product launches worldwide in response to increased demand. For instance, global firms such as Polaris seek to improve their product offering in the sector of fish-free omega-3. As a result, it introduced Omegavie DHA 800 microalgae oil in June 2021, guaranteeing at least 800 mg/g of DHA.
The rising sustainability concerns regarding wild-caught fish have sparked greater interest in alternative EPA sources, including algae. Companies are extensively focusing on the segment to meet growing market demand. In 2021, AlgiSys BioSciences, Inc. raised USD 45 million in Series B capital to fund the company's early commercial objectives, driven by global customer demand for EPA omega-3 fish oil alternatives. Nonetheless, the growing number of clinical trials proving the efficacy and safety of EPA-derived pharmaceutical products and the increasing interest of drug manufacturers to use EPA has propelled the demand for EPA in supplements.
According to a new study, EPA-produced by-products related to immune function modulation worked better than those derived from DHA after metabolizing. EPA enhanced the balance of pro- and anti-inflammatory proteins. Such research leading to innovations is projected to significantly spur the segment's growth in the forecasted period.
Based on application, the global algae omega-3 ingredients market is segmented into food and beverage, dietary supplements, pharmaceuticals, and animal nutrition.
The dietary supplements segment owns the highest market share and is estimated to exhibit a CAGR of 10.54% during the forecast period. The algae omega-3-based supplements are particularly developed for addressing brain, heart, and inflammatory health. DHA-based ingredients are increasingly incorporated in dietary supplements for sports nutrition, endurance formulae, and active and lifestyle nutrition. Evidence from studies in athlete populations supports the claim that omega-3 supplementation may facilitate muscle growth during resistance training and help preserve muscle mass when calories are restricted or during immobilization. In addition, the growing number of vegan/vegetarian consumers, particularly athletes, has generated a substantial opportunity for algal omega-3 ingredients in the supplement market. Instead of fish or krill, most vegan/vegetarian omega-3 supplements are made from algae.
In the pharmaceutical industry, the promising regulatory backup, in the form of approvals, has been a major driving factor for the utilization of algae omega-3. The algae-based omega-3 with high concentrations, varying from 700 to 900 mg/g, is preferred in the pharmaceutical sector for its product formulation. The pharmaceutical formulations of EPA and DHA mainly target joint relief, heart health, lipid profiles, and overall immunity. In addition, producers are employing innovative technologies to improve their solutions' functionality or broaden their applications, mostly to replace fish oil.
For instance, in September 2021, KD Nutra, based in Germany, launched Alga3TM, a new nutritional platform of plant-based omega-3 concentrates derived from microalgae that employ various state-of-the-art purification technologies. The range can be customized to provide a vegan alternative to KD-pür fish oil.