Flavoring and specialty natural ingredient company Frutarom Industries announced its investment in algae to enhance its food and cosmetic products.
The company bought half of biotechnology startup Algalo—based on a kibbutz, communal farm in northern Israel—which developed a way to cultivate, harvest and process various algae.
With an investment of 10 million shekels—equivalent to $2.56 million—the ingredient company is looking at 50% of the shares in addition to building a modern biotechnology facility for algae harvesting.
According to the startup, almost all species of microalgae in high productivity is able to grow using the company’s low-cost photobioreactor, which utilizes light to cultivate algae.
According to Ori Yehudai, chief executive, Frutarom, the size of the algae-based ingredient market is estimated to be hundreds of millions of dollars and has grown at double-digit rates in recent years.
"We foresee the rapid growth in this market continuing in coming years in light of consumer trends towards healthier and more natural products," he said.