INDIA— Germany’s BASF Venture Capital has partnered with Dutch sustainable aquaculture fund Aqua-Spark to back red seaweed cultivation pioneer Sea6 Energy in its Series-B round, which has garnered US$18.5 million in total.
Sea6 Energy was founded in 2010 and is based in Bangalore, India, specializing in producing and processing tropical red seaweed. The company has also set up a fully owned subsidiary in Bali, Indonesia that carries out commercial seaweed farming.
Biomass from the fast-growing red seaweed is suitable as a raw material for a variety of applications including animal feed and crop protection products, said the investors.
Red seaweed grows mainly in tropical waters in Asia, which have constant, high temperatures conducive to year-round growth of seaweed, yet only a small proportion of the commercially offered seaweed comes from wild collections.
Most of it is grown in farms, particularly in Asia, and since 1950, the quantity produced worldwide has increased a thousandfold. according to the FAO report: Global status of seaweed status of seaweed production, trade, and utilization, in 2019, nearly 35 million tons of seaweed were produced, about half of which is red seaweed.
However, commercial offshore cultivation on a large scale is complex, and the technical systems must withstand adverse weather conditions, such as storms and waves.
Sea6 Energy has adapted its cultivation technology to the conditions in deeper water and adverse weather conditions and covers both parts of the value chain with its integrated business model. To identify the right locations with the right conditions for its farms, Sea6 Energy uses satellite imagery, for example. Under suitable conditions, at least six harvests per year are possible.
Sea6 also processes red seaweed for different applications such as the production of biostimulants for use in agriculture and shrimp farming that it claims increase resistance to disease and stress, and is also working on the development of bioplastics and biofuels based on red seaweed.
In addition, Sea6 maintains that it has developed a process that boosts the shelf life of red seaweed from one to two days to up to 60 days. This facilitates the transport of fresh red seaweed, which can otherwise only be transported over longer distances once it has been dried.
According to Grand View Research, the global commercial seaweed market size was valued at US$ 16.6 billion in 2020 and is expected to expand at a compound annual growth rate (CAGR) of 10.8% from 2021 to 2028.
The market demand is anticipated to be driven by the growing technological developments in cultivating seaweed such as these, coupled with the rising investments in application segments, including animal feed and agriculture.
Liked this article? Subscribe to Food Business Africa News, our regular email newsletters with the latest news insights from Africa and the World’s food and agro industry. SUBSCRIBE HERE