Having purchased the assets of TerraVia in September 2017, Corbion is seeking to leverage the algae platform to develop an innovative new algae-based shrimp feed additive in Asia, according to company executives.
Jill Kauffman Johnson, Corbion’s head of global market development for algae ingredients, told SeafoodSource Corbion’s takeover had been a net positive AlgaPrime DHA, the long-chain omega-3-rich aquaculture feed developed by TerraVia.
“We’re now part of a global company based in the Netherlands that has deep experience in ingredients production,” Kauffman Johnson said. “We’re seeing new levels of expertise and investment coming into the company, and as a result, we’re able to continuously improve our fermentation production activity.”
That investment has stretched into TerraVia’s production agreement with Bunge Limited, a New York-based company it signed a distribution agreement with in May 2016 to jointly produce AlgaPrime at the SB Renewable Oils factory in Orindiúva, Brazil. In June 2018, Corbion acquired Bunge’s stake in the joint venture, spending more than USD 22.5 million (EUR 19.6 million) on the acquisition. The deal also includes a five-year earn-out provision with a maximum value of an additional USD 20 million (EUR 17.4 million).
Corbion Global Aquaculture Lead Chris Haacke said Corbion’s acquisition had not affected production or product development.
“There has been no slowdown at all during the transition. Both groups were very well aligned, which made integration very easy,” he told SeafoodSource. “If anything, having access to the engineering manufacturing abilities of Corbion has made production smoother and has given us improvement on efficiency.”
Corbion's algae operations are still based in San Francisco, California, U.S.A., and the company still operates research and development and pilot facilities in California, as well as a demonstration plant in Peoria, Illinois, Kauffman Johnson confirmed. Employees at each facility are in regular communication with their new colleagues in the Netherlands, she said.
“There is a lot of coordination. We get quite a bit help around fermentation as Corbion has a lot of expertise – there’s a lot of distance learning – obviously at our factory in Brazil as well,” she said.
Corbion is willing to accept short-term losses in its investment in TerraVia in exchange for its potential to produce high-value ingredients for a variety of industries, company CEO Tjerk de Ruiter said in a company announcement.
“TerraVia's IP portfolio and R&D pipeline, as well as its partnerships with industry leaders, provide high-growth opportunities for many years to come,” de Ruiter said. “At the same time, we are of course aware of the challenge of bringing the business from promise to commercial success. Corbion's more than 80 years of reliably and economically running industrial-scale fermentation plants and producing sustainable ingredient solutions will help us turn the TerraVia assets into profitable businesses in the coming years."
The winner of the 2017 Global Aquaculture Innovation Award, AlgaPrime is considered one of Corbion's most promising products, as it allows aquaculture firms to lower their fish-in, fish-out (FIFO) ratios, while at the same time maintaining – or even augmenting – the amount of omega-3 content in their fish.
The company is now earning revenue from AlgraPrime, which is being used as an ingredient in BioMar feed for Lerøy Seafood’s Aurora Salmon, Silverside Coho Salmon from Ventisqueros, and Blue Circle Salmon, Haacke told SeafoodSource. Getting those “first movers” was a huge step for Corbion, Kauffman Johnson added.
“It has been quite a journey. AlgaPrime DHA won innovation award a year ago, and now a year later, here we are actually with salmon products on store shelves in the market in the U.S. and Europe that have been fed AlgaPrime DHA. It’s a nice moment for us, and we think it’s an important milestone for the industry in showing its adoption of this new ingredient,” she said. “These are companies that are innovative in a certain way or want a point of differentiation. And they are products that are available at a range of supermarkets across the U.S. – everything from basic to high-end. W believe it will continue to be adopted in other companies.”
Corbion has a multifaceted expansion strategy, beginning with expansion in the Atlantic salmon market, and adding in other species, such as coho salmon and rainbow trout. The company is also working with aquafeed producers in Asia to incorporate AlgaPrime DHA into shrimp feed.
“We’re growing,” Haacke said. “Obviously, we would like to take over the planet overnight but that’s just not reality. But we’re building momentum, and we’re pretty pleased with where we are pushing to take the next steps.”
Adding AlgaPrime to shrimp feed allows companies to drastically reduce the amount of fish oil needed to create a nutritious feed that is showing “very good results in all stages of the shrimp lifecycle,” Haacke said. Using an algae-based feed also offers shrimp-farming companies assurance in the sustainability of their feed, and allows them to add omega-3s into their product, he added.
In seeking new partners, Corbion looks to put sustainability front and center in its messaging.
“One of nicest benefits of Corbion’s [management] is that they’re deeply committed to sustainable food production in the future. They’ve aligned themselves with the United Nations’ Sustainable Development Goals,” Haacke said. “We’re interested in finding those companies that are interested in making that change and who are concerned in changing their supply chain to make it more sustainable.”
Kauffman Johnson said many of the companies now using AlgaPrime as part of their aquafeeds boast about it publicly. Lerøy and feed producer BioMar, for example, made a large public announcement about its adoption of AlgaPrime at the 2017 Seafood Expo Global in Brussels, Belgium.
“Nearly all of the companies using AlgaPrime … are pretty vocal that they’re using microalgae in their feed,” Kauffman Johnson said. “While it used to be unusual [to go into detail about feed ingredients], customers are more and more interested in hearing the story of their products they buy, and their provenance. We think that’s something that could find even more resonance in the future.”
And while AlgaPrime remains a big part of Corbion's business, the company is not limiting itself to the aquafeed market. It’s also looking at terrestrial animal feeds, and it just launched a culinary algae oil that is being distributed nationally in the United States by Walmart. The oil is being marketed with a focus on its health qualities – it has one of the lowest amounts of saturated fats of any cooking oil, and is high in monosaturated fats.
“The rise of the application of algae in many different ways reveals the heart of what makes it so appealing to the aquaculture industry,” Kauffman Johnson said. “It’s the nutritional aspect that’s interests aquaculture companies most about AlgaPrime DHA. To be able to market a product that’s got high levels of omega-3s and that doesn’t negatively impact the ocean – that strikes right to the heart of what we do, which is enhance nutrition responsibly.”
Photo courtesy of Corbion
By Cliff White
AlgaPrime DHA Receives the 2017 Global Aquaculture Innovation Award
AlgaPrimeDHA, a sustainable, omega-3-rich whole algae ingredient produced by the joint venture partnership of Corbion, N.V. (AMS: CRBN) and Bunge Limited (NYSE: BG), has received the 2017 Global Aquaculture Innovation Award from the Global Aquaculture Alliance. The Global Aquaculture Alliance (GAA) is a leading standards-setting organization for aquaculture seafood. GAA established the award in 2012 to recognize individuals and companies finding new solutions to the key challenges facing aquaculture.
According to GAA, the 2017 Global Aquaculture Innovation Award garnered the strongest competition to date with entries from more than 10 countries. Many of the innovations, including AlgaPrime DHA, originated from the aquafeed ingredient sector.
Walt Rakitsky, Emerging Business & Corporate Account Leadership for Corbion stated, "We are extremely honored to receive this award. The Global Aquaculture Innovation Award represents the future of aquaculture, and we believe that AlgaPrime DHA is a key feed ingredient for the industry's continued growth. A new sustainable and transparent source of long-chain omega-3 DHA, AlgaPrime DHA can responsibly enhance the nutritional value of seafood, delivering an important win-win for both people and the planet."
Miguel Oliveira, Bunge's Vice President of Global Innovation, added, "Aquaculture is one of the fastest growing food production systems in the world - a market estimated to reach $200 billion annually by 2020. We're producing AlgaPrime DHA at an unprecedented scale to address this growing need, offering supply chain resilience and on demand production without the constraints of geography, seasonality and changing climate conditions."
AlgaPrimeDHA is currently produced at Corbion's and Bunge's SB Renewable Oils joint venture facility in Brazil. The facility embodies the principles of sustainable production to produce algae-based products with low carbon, water and land use impacts. Based on sugarcane feedstock, AlgaPrime DHA has a lower carbon and water footprint and higher yield per hectare than DHA produced from most other non-marine sources.
On September 29, 2017, Corbion completed the purchase of TerraVia, which included AlgaPrime DHA. San Francisco-based TerraVia has developed a microalgae platform to deliver high-value ingredients with clear benefits, such as Omega-3 oils for animal nutrition and tailored oils, structured fats and proteins for food, personal care and industrial applications. Corbion Algae Ingredients operates an R&D center and pilot facility in San Francisco, a demonstration plant in Peoria, Illinois and an industrial scale plant in Brazil in a joint venture (50.1% owned by TerraVia) with Bunge. The acquisition is expected to bring high value creation potential for Corbion.
Corbion is the global market leader in lactic acid and lactic acid derivatives, and a leading company in emulsifiers, functional enzyme blends, minerals and vitamins. We develop sustainable solutions to improve the quality of life for people today and generations to come. For over 100 years, we have been uncompromising in our commitment to safety, quality and performance. Drawing on our deep application and product knowledge, we work side-by-side with customers to make our cutting-edge technologies work for them. Our solutions help differentiate products in markets such as food, home & personal care, pharmaceuticals, medical devices and bioplastics. In 2016, Corbion generated annual sales of € 911.3 million and had a workforce of 1,684 FTE. Corbion is listed on Euronext Amsterdam. For more information: www.corbion.com
About Bunge Limited
Bunge Limited (www.bunge.com, NYSE: BG) is a leading global agribusiness and food company operating in over 40 countries with approximately 32,000 employees. Bunge buys, sells, stores and transports oilseeds and grains to serve customers worldwide; processes oilseeds to make protein meal for animal feed and edible oil products for commercial customers and consumers; produces sugar and ethanol from sugarcane; mills wheat, corn and rice to make ingredients used by food companies; and sells fertilizer in South America. Founded in 1818, the company is headquartered in White Plains, New York.
bericht op de website van TerraVia van 5 okt. j.l.(red.).