Algae Oil Market Size and Share Outlook - Forecast Trends and Growth Analysis Report (2025-2034)

The algae oil market attained a value of USD 1.83 Billion in 2024. The industry is expected to grow at a CAGR of 4.10% during the forecast period of 2025-2034. By 2034, the market is expected to reach USD 2.74 Billion.

As consumers increasingly seek plant-based and eco-friendly products, algae oil is gaining attention as a sustainable alternative to fish and vegetable oils. Algae cultivation requires less land and water and produces fewer greenhouse gases, aligning with global environmental goals. This demand is further fueled by health-conscious individuals and ethical concerns surrounding animal-derived products, driving innovations. In October 2024, Cargill introduced DHA algal oil to highlight its expertise in specialized nutrition solutions.

Strategic alliances between algae tech companies, food producers, pharmaceutical firms, and research institutions are driving innovation and commercialization in the algae oil industry. These collaborations enable knowledge sharing, infrastructure development, and faster product rollouts. For example, partnerships between algae cultivators and aquafeed companies have helped scale algae-based omega-3 oils in fish farming. Similarly, cosmetic brands partner with biotech firms to access algae-derived ingredients for clean beauty lines. International collaboration is also fostering global standards and regulatory harmonization, making cross-border trade and expansion easier.

Key Trends and Recent Developments

June 2025

Veramaris increased its algae oil production by 61% while significantly reducing greenhouse gas emissions. By optimizing processes and scaling operations, Veramaris demonstrates its commitment to environmental responsibility and meeting the growing demand for eco-friendly nutritional solutions.

February 2024

GC Rieber launched its new algal EPA and DHA oil at Expo West, targeting the growing demand for plant-based omega-3 supplements. Derived from microalgae, the oil offers a sustainable, vegan alternative to fish oil, supporting heart, brain, and eye health. This launch underscores the company’s commitment to innovative, eco-conscious nutritional solutions.

December 2023

DIC Corporation developed DAILUBE™ KS-519, the world’s first high-performance sulfurized extreme pressure (EP) additive derived from algae oil. This innovation offers enhanced lubrication, sustainability, and biodegradability compared to traditional petroleum-based additives, marking a major step toward eco-friendly industrial lubricants.

August 2024

HELLER unveiled the F 5000 5 Axis Machining Centre as part of its next generation F series at AMB 2024. Engineered for precision and automation, the F 5000 boasts a compact rack type tool magazine, both swivel and tilt head kinematics, optional DDT mill turn capability, and is designed for seamless integration with pallet automation systems.

Expansion of Algae Oil in Functional Foods

The algae oil market is recording higher incorporation into functional foods and beverages due to its nutritional profile, especially its high omega-3 content. Food manufacturers are exploring algae oil as an ingredient in plant-based dairy, fortified snacks, and cooking oils. In October 2024, Protoga Biotech introduced the world's first commercially available microalgae milk. This trend is driven by consumer preferences for foods that offer added health benefits without compromising on taste.

Technological Advancements in Algae Cultivation

Technological innovations in algae cultivation, harvesting, and oil extraction are reducing production costs and improving yields. Closed-loop photobioreactors, improved strain selection, and genetic engineering have made algae farming more efficient and commercially viable. In May 2025, Sun Chemical, via its subsidiary Earthrise Nutritionals, launched a sustainable spirulina cultivation facility in California. Such improvements are critical to making algae oil competitive with traditional oils in terms of price and availability.

Increasing Investment and Startup Activity

The algae oil industry value is expanding with significant investments from venture capitalists, corporates, and government grants. Startups are developing innovative technologies for cultivation, harvesting, and processing, while larger players are forming partnerships or acquiring promising companies. In October 2024, Algiecel raised EUR6.5 million in funding to expand its microalgae production for sustainable food and feed applications. These investments are not only boosting production capacity but also accelerating the development of new algae-derived products across various sectors, including cosmetics, pet food, and agriculture.

Rising Interest in Omega-3 Supplements

Algae oil is a rich, vegan source of EPA and DHA, essential omega-3 fatty acids typically obtained from fish oil. With more people adopting vegetarian or vegan lifestyles and avoiding fish due to sustainability concerns, algae-derived omega-3 supplements are becoming highly attractive. Pharmaceutical and nutraceutical industries are investing in algae oil for heart, brain, and eye health supplements. As awareness of omega-3 health benefits rises globally, algae oil is becoming a preferred and scalable solution.

Government Support and Regulatory Incentives

Governments worldwide are supporting algae oil market development via research grants, subsidies, and favorable regulations. In January 2025, the United States DOE’s Bioenergy Technologies Office (BETO) offered USD 10 million in funding for supporting high-impact research and development focused on algae system cultivation and preprocessing. Regulatory frameworks are evolving to include algae oil in food and nutraceutical categories, simplifying approvals. Government backing encourages innovation and helps build infrastructure and standards that promote long-term market growth.

Algae Oil Industry Segmentation

The report titled “Algae Oil Market Report and Forecast 2025-2034” offers a detailed analysis of the market based on the following segments:

Market Breakup by Grade

• Food Grade
• Feed Grade
• Fuel Grade

Key Insight: Food-grade algae oil is the most valuable and widely adopted grade, driven by rising consumer demand for vegan, sustainable nutrition. It is rich in omega-3 fatty acids like DHA and EPA, making it ideal for use in dietary supplements, fortified foods, plant-based dairy, and cooking oils. In February 2024, Algae Cooking Club launched a chef-grade algae oil, offering a sustainable, nutrient-rich cooking alternative with high heat stability. With growing awareness around heart and brain health, especially in aging populations, food-grade algae oil market value continues to expand rapidly.

Market Breakup by Application

• Biofuel
• Dietary Supplements
• Pharmaceuticals
• Animal Feed
• Food and Beverage

Key Insight: The dietary supplements segment dominates the market due to the rising demand for plant-based omega-3 fatty acids, such as DHA and EPA. Major players offer algae-based omega-3 supplements targeting heart, brain, and prenatal health. In December 2024, Nature’s Bounty launched a plant-based omega-3 supplement from algae to offer a vegetarian alternative to fish oil for overall wellness. The growing popularity of vegan diets and sustainable sourcing has positioned dietary supplements as the leading application for food-grade algae oil.

Market Breakup by Region

• North America
• Europe
• Asia-Pacific
• Latin America
• Middle East and Africa

Key Insight: North America leads the global algae oil market due to its robust demand for plant-based nutrition, technological innovation, and high awareness of sustainability. The region benefits from strong regulatory support and consumer preference for clean-label, vegan products. Increasing investments in algae biofuels and animal feed further support market dominance, driven by ESG commitments and policy incentives. In March 2023, United Airlines’ UAV Fund invested USD 5 million in Viridos, using bioengineered saltwater algae to produce sustainable, low-carbon jet and diesel biofuel.

Algae Oil Market Share

Surging Preference for Feed Grade & Fuel Grade Algae Oil

Feed-grade algae oil is increasingly used in aquaculture and livestock feed, offering a sustainable alternative to fishmeal and fish oil. Several producers supply algae oil rich in omega-3s to salmon farms, contributing to cleaner, more ethical seafood production. In May 2024, Aker BioMarine expanded into algae oil to meet the rising global demand for sustainable animal feed alternatives. In pet food, algae oil is used for joint health and coat quality.

The fuel-grade algae oil demand growth is driven by primarily uses in biofuel and biodiesel applications. While algae can yield more oil per acre than terrestrial crops, scaling economically has proven challenging. Companies like ExxonMobil, Sapphire Energy, and Algenol have conducted pilot projects to develop algae-based fuels. Fuel-grade oil is typically lower in purity and quality compared to food and feed grades, but its value lies in renewable energy and carbon-neutral transport systems.

Thriving Algae Oil Demand in Pharmaceuticals & Food and Beverages

Pharmaceutical use of algae oil is gaining traction, particularly for its high purity and bioavailability of essential fatty acids. Algae-derived EPA and DHA are incorporated into prescription medications for managing cardiovascular, cognitive, and inflammatory conditions. Companies are investing in algae oil as an alternative to fish-based omega-3s to ensure consistent quality and supply. The pharmaceutical segment uses food-grade and pharma-grade algae oil with rigorous standards, benefiting from increasing clinical research on the efficacy of algal bioactive in managing chronic diseases.

The algae oil market analysis is impacted by rising application in mainstream food and beverage products. Algae oil enhances the nutritional profile of foods with omega-3s, antioxidants, and healthy fats, appealing to vegan and health-conscious consumers. In May 2024, MegaFood launched Omega 3-6-9, featuring fish-free algae oil for sustainable omega-3 support. Food-grade algae oil offers a neutral flavor and long shelf life, making it versatile for processed foods, snacks, and plant-based formulations.

Algae Oil Market Regional Analysis

Surging Algae Oil Consumption in Asia-Pacific & Europe

Asia-Pacific is the fastest-growing region for algae oil, due to increasing demand for functional foods and sustainable aquaculture. China, Japan, and India are investing in microalgae cultivation for feed, supplements, and food applications. Protoga Biotech in China and Sophie’s Bionutrients in Singapore are notable innovators, launching algae-based dairy and protein products. Rising health awareness and environmental concerns among urban populations are driving adoption. Government support in algae farming and marine biotechnology is growing, adding to the regional market growth.

Europe holds a major algae oil market share, driven by its sustainability agenda and progressive regulatory frameworks under the European Union’s Green Deal. European consumers are highly receptive to plant-based products, supporting algae oil’s use in dietary supplements, fortified foods, and cosmetics. In January 2024, England-based UFAC-UK launched Algi40, a native algae-based Omega-3 supplement designed to sustainably support livestock health and performance. The region also invests in algae for aquaculture and biofuel applications, encouraged by circular economy goals.

Competitive Landscape

Key players in the algae oil market are adopting several key strategies to gain a competitive edge and capitalize on growing demand across sectors. One primary strategy is investment in research & development to enhance yield, extraction efficiency, and strain development, enabling cost-effective production of high-quality oils rich in omega-3 fatty acids like DHA and EPA. Companies are also embracing genetic engineering and biotechnology to improve lipid content and growth rates of microalgae.

Strategic partnerships and collaborations with food, nutraceutical, aquafeed, and biofuel companies are facilitating product development. Many players are securing sustainability certifications and leveraging clean-label marketing to appeal to environmentally conscious consumers. Geographic expansion, particularly in North America, Europe, and Asia-Pacific, is being driven by increased consumer awareness and favorable regulations. Lastly, firms are targeting diversified applications beyond supplements, such as plant-based dairy, cosmetics, and bioplastics, to broaden revenue streams in the algae oil industry.

Algae Floating Systems, Inc.

Founded in 2007, Algae Floating Systems has emerged as a leader in sustainable algae cultivation. Headquartered in the United States, the firm designs patented floating-algae farms using modular, air lift technology to efficiently grow biomass with minimal environmental impact. Its systems supply food, feed, nutraceutical, and biofuel sectors.

Algae Production Systems, Inc.

Founded in 2008, Algae Production Systems is a Houston, Texas-based company produces turnkey, commercial-scale algae cultivation systems. Its closed photobioreactor technology automates algae growth, harvesting, and oil extraction, boosting yields, cutting labor, and enabling production of biodiesel feedstock and organic fertilizers.

Algatech Ltd.

Established in 1998 and headquartered in Ketura, Israel, Algatech has become a specialist in large-scale microalgae production. It offers high standard products such as AstPure (astaxanthin), BioGlena, FucoVital, and Biocolians, serving global markets with premium algal nutritional ingredients.

Algix LLC

Founded in 2010 in Meridian, the United States, Algix transforms pollution-causing algae into eco-friendly materials. Its innovations include Bloom® bioplastic foams, algae based 3D printer filaments, and sustainable flexible foams, all harvested from waste algal biomass and used in footwear, packaging, and consumer goods, with measurable clean air and clean water benefits.

Other players in the algae oil market are Cellana Inc., Pond Technologies Inc., and Corbion N.V., among others.

Key Features of the Algae Oil Market Report

• Comprehensive quantitative analysis of market size, share, and growth forecasts.
• In-depth segmentation by application, grade, and region with future outlook.
• Detailed insights into competitive landscape and key player strategies.
• Coverage of recent innovations, investments, and product launches.
• Evaluation of demand drivers and emerging algae oil market trends.
• Regional analysis highlighting dominant and fast-growing markets through 2025.

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