The investment looks to triple production numbers from over 1,500 kilograms (kg) to 5,000kg of astaxanthin per year, when the new facility is expected to be operational in 2022.
“This is one of the biggest foreign investment projects in Iceland for a while” comments Orri Björnsson, Algalif CEO. “All our production this year, and most of next year’s astaxanthin production is sold.”
The expansion is set to more than double working space from 5.500m² to 12.500 m² in a construction project that will create over 100 new local jobs. From 2023 permanent jobs will double from 35 to 70 employees.
The investment closely follows a similar series of upgrades around two years ago that welcomed the addition of a spray dryer to increase downstream capacity and aid development of algae ingredients and product formats.
The investment was made possible via grants from The Icelandic Centre for Research’s Technology Development Fund and the European Union’s SME Instrument program.
The decision to expand production capabilities taps into surging demand for this naturally occurring algae-based carotenoid that has seen the haematococcus pluvialis market predicted to grow at a Compound annual growth rate (CAGR) of 13.2% from 2020 to 2027 to reach €107.1m by 2027.
Astaxanthin is extracted from Haematococcus pluvialis and research has shown a number of distinct health benefits that include eye & brain health; skin health & “beauty from within;”
Further research has suggested benefits for the immune system; cardiovascular support as well as anti-aging properties.
Demand has seen BGG, currently the second largest producer of natural astaxanthin, recently announce plans to double capacity in a move to become the world's largest.
In April 2020, its subsidiary Algae Health Sciences, (AHS) announced two expansions of their 100% glass tube photobioreactor microalgae farm based in Calfornia.
With the first stage of this expansion already underway that includes the installation of additional glass tubing, the upgrade is said to increase current capacity by 25% in the third quarter of 2020.
The second stage, which is set for completion in Q1 of 2021, looks to double the farm’s land area by claiming land acreage directly adjacent to BGG’s current farm.
Meanwhile in October 2019, the Israeli-based firm Algatechnologies, part of Solabia Group, sought to triple its production capacity of a fucoxanthin extract derived from the microalgae Phaeodactylum tricornutum in response to demand from the dietary supplements market.
Fucoxanthin is an orange-brown carotenoid that is a rich source of fucoxanthin and compounds such as omega-3’s (EPA) and other beneficial fatty acids.
Research suggests fucoxanthin plays a significant role in supporting liver health and metabolic function.