Algae Oil Market By Product Type (Food Grade, Feed Grade, Industrial Grade), By Application (Food & Beverages, Dietary Supplements, Pharmaceuticals, Animal Feed, Cosmetics & Personal Care, Biofuels), By Source (Microalgae, Macroalgae), By Distribution channel (Online Retail, Supermarkets/Hypermarkets, Pharmacies & Health Stores, Direct Sales (B2B)), and By End-user (Food and Beverage Industry, Nutraceutical Industry, Energy Industry, Animal Nutrition Industry, Cosmetics Industry, Pharmaceutical Industry), Global Market Size, Segmental analysis, Regional Overview, Company share analysis, Leading Company Profiles And Market Forecast, 2025 – 2035

Industry Outlook

The Algae Oil market accounted for USD 2.5 Billion in 2024 and is expected to reach USD 5.06 Billion by 2035, growing at a CAGR of around 4.5% between 2025 and 2035. The need for sustainable and plant-based alternatives to traditional oils is growing, which can be seen in the increase in the algae oil market.

Algae oil is the result of some algae species and has omega-3 fatty acids such as DHA plus EPA acids that are very important to have to keep dosage in supplements, on the one hand, and to make its use in functional foods a good one, on the other hand. Moreover, it is also a major source of green energy in the biofuel industry through its renewable energy production and has such a small carbon footprint. Algae farming has moved forward with the use of technology and algae oil extraction, making production more efficient and cost-effective. The algae oil market has shown a strong potential for growth, prompted primarily by the increasing consumer demand for health and eco-friendliness.

Report Scope:

Market Dynamics

Health Benefits of Algae Oil in Cardiovascular, Cognitive, and Prenatal Wellness

The growing popularity mainly is due to the consumers' growing understanding of its importance in protecting them from cardiovascular, cognitive, and prenatal issues. Algae oil, which is rich in DHA and EPA omega-3 fatty acids, betters the state of the heart by decreasing inflammation, lowering cholesterol, and enhancing blood flow. Its central position in brain performance and cognitive progress is why the organic baby food and dietary supplements sectors are expanding. Women who are expecting children are major buyers of this product since the DHA is required for the baby's brain and vision development.

Plant-based and eco-friendly fish oil gained momentum as the incidence of heart disease and neurological disorders increased. However, the high costs of production and lack of information among the general public are still obstacles. One of the pluses was the growth of algae breeding, extraction technology, and product innovation which are likely to be the main growth drivers of the algae oil market shortly.

Transition from Fish Oil to Algae Oil Due to Sustainability Concerns

The major driver of the change from fish oil to algae oil is the increasing concern about overfishing and its negative environmental effects. Overfishing has caused fish stocks to decline, which has meant more fishing for oil and making it more expensive. As people and businesses keep taking proactive environmentally friendly steps, algae oil becomes an eco-sustainable and renewable source of omega-3 fatty acids.

Algae cultivation consumes fewer resources compared to marine ecosystems and does not cause their destruction thus fitting in as an eco-friendlier and scalable solution. In addition to imparting product information, the amalgamation of plant-based oil also makes use of rhetorical knowledge and addresses society's existing sustainability and environmental benefits of oil. Thus, the algae oil market is becoming a feasible alternative to traditional fish-based oils and is growing at a swift pace.

High Cost of Extraction and Processing Limiting Algae Oil Market Scalability

Algae oil extraction and processing costs are very high; thus, it stands as a major obstacle to its flexibility. Advanced methods like supercritical CO2 extraction and solvent extraction are the ones that must be tacked to get the premium quality of the algae oil, but these processes are demanded to be carried out by the most complicated machinery as well as using up an enormous amount of energy. This factor makes production more expensive than that of other traditional oil sources like soy or palm.

Algae oil is a good eco-friendly alternative, but the high start of investment in technology and infrastructure is yet the main obstacle that prevents wide adoption and large-scale production from the other end. Along with that, the ongoing innovations connecting with more cost-efficient extraction and processing methods are a great way to cut production costs and make the algae oil market grow.

Rising Demand for Algae Oil in Fortified Foods and Plant-Based Diets

The upsurge of plant-based diets and the fortification that food requires are the major reasons for the algae oil market's growth. Omega-3 fatty acids that are high in DHA and EPA are contained in the algae oil which means it is a very important supplement for plant-based and vegan diets that cannot be obtained with other foods. Since it has a neutral flavor and is versatile, product developers can use it in the production of many kinds of food such as smoothies, energy bars, and plant-based meat alternatives.

With information spreading quicker on health and the rise in the number of plant food products, the inclusion of algae oil in fortified foods remains to be a successful marketing strategy thereby augmenting the wider acceptance and demand of the product in the algae oil market.

Advancements in Algae Cultivation and Oil Extraction Technologies

Improvements in the field of algae cultivation and oil extraction are, by far, the main drivers of productivity and expandability of algae oil production. Advances in algae farming such as the use of photobioreactors and enhanced cultivation systems lead to higher yields in controlled environments, thus, mitigating the need for open-water systems.

Recent extraction methods such as enzymatic and solvent-free have made the oil production process more economical and environmentally friendly. These fresh approaches are dramatically reducing production costs and at the same time, upping the level of algae oil cleanliness and quality. Hence, algae oil is now more available, indisputably, for a range of applications, from food to pharmaceuticals, thereby driving algae oil market development.

Industry Experts Opinion

“Algae oil stands as a game-changer in nutrition and healthcare, offering a potent, sustainable source of omega-3s like DHA and EPA. Its proven benefits in cardiovascular health, prenatal care, and beyond underscore its growing role in the functional food and nutraceutical industries."

• Mayukh Sarkar, Professor

"The latest research reaffirms that algae oil is a bioequivalent and sustainable alternative to fish oil, delivering essential DHA effectively to both omnivores and plant-based consumers. As demand for eco-friendly nutrition rises, algae oil is poised to revolutionize the omega-3 market."

• Lisa Ryan, Faculty of Medicine

Segment Analysis

Based on the Type, the algae oil market is divided into food grade, feed grade, and industrial grade, each of which is very different and serves unique end-user industries. Algae oil of food grade is widely used in dietary supplements, functional foods, and fortified beverages because it has a very high nutritional value, especially the rich omega-3 content. Feed-grade algae oil is finding favor in the animal nutrition industry. It is a DHA-rich and sustainable alternative to fish oils. It is used in aquaculture and livestock feed. Industrial-grade algae oil has applications in biofuels, lubricants, and specialty chemicals being one of the contributors to the shift towards renewable energies and sustainable industrial solutions. The growing demand for clean-label, plant-based, and eco-friendly alternatives is the driver of the adoption of algae oil in these different categories.

Based on Application, the Algae oil market is divided into many sectors. In the food and beverages sector, it has been widely used in vegan alternatives such as substitutions for dairy, cooking oils, and a host of other enriched products. The human health segment, encompassing dietary supplements, is leading the algae oil market as, inherently, people are migrating to the consumption of products that are certified or proven with omega-3. Pharmaceutical products, on the other hand, like those for cardiovascular, cognitive, and prenatal health tend to be rich in bioactive compounds of algae oil. Animal feed, especially in the field of aquaculture, which comes from the sea, is one of the beneficiaries of algae oil as a sustainable DHA source. In its skincare segment, algae oil is used to formulate moisturizing and anti-aging products for consumers starring in personal care and cosmetics. The biofuels category, which is one of the many Wastes to Bioenergy companies also, makes use of the algae oil as the main feedstock. The ever-growing attention to algae oil’s advantages to society is contributing to the fast revolution of its use in the given applications. 

Regional Analysis

North America is at the top of the algae oil market because people are starting to eat more plant-based omega-3 supplements as well as fortified foods, animal fats not being the main source of omega-3 fatty acids are also contributing to this. The US dominated the area with the presence of the nutraceutical and functional food sectors as they grow in terms of investments in algae biofuel research. For that same reason, environmental regulations become stricter, and initiating environmental sustainability practices is switching the fish oil source to algae-derived alternatives in food and animal feed applications.

Asia-Pacific is following the trend of the fastest-growing rise in obesity due to health consciousness, the growth in the vegan and vegetarian population, and the increase in the demand for functional foods and dietary supplements. Countries such as China, India, and Japan have been exploiting the potential of algae oil, consequently, these countries are increasingly using it in the production of pharmaceuticals, cosmetics, and aquaculture. Renewable energy and sustainable agriculture are the government's letters of support for these doings, which, besides cutting down pollution, also promote the economic growth of the given country or the whole region. The rapid urbanization of the region's middle class and changing lifestyles require the increased consumption of algae oil which in the future should make the algae oil market very attractive to the industry. 

Competitive Landscape

Major companies operating in the algae oil market compete moderately as they develop new products while forming sustainable partnerships to enhance their business reach. The algae oil market operates under the control of leading companies like DSM and Corbion along with Cargill, BASF, and Polaris which combine state-of-the-art extraction techniques with extensive research and development efforts.

Mid-sized and startup companies enter the market because customers need vegan omega-3 supplements as well as biofuels and functional food applications. The production capabilities of companies improve through the combination of corporate mergers and acquisitions with biotech firms. Industrial demands for sustainable plant-based products compel companies to develop new alternative products. The high production costs along with scalability hurdles serve as major obstacles that prevent new companies from entering the lipid products market. The accomplishment of competitive superiority stands on both regional business development and government approval success. Market rivalry intensifies as the pharma, nutraceuticals, cosmetics, and biofuel sectors adopt plant technology at an increased rate throughout the industry.

Algae Oil Market, Company Shares Analysis, 2024

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Recent Developments:

• In August 2023, A major algae oil company, Corbion, enriched its product range with the introduction of algal omega-3 and omega-9 dietary supplements. Additionally, with the help of the extensive algae strain library, Corbion has started to operate in the human nutrition field and for plant-based nutrition.
• In April 2023, A Scottish biotech company MiAlgae chose NaturAlgae, a rich source of omega-3 from algae, set up primarily for use in the fish feed and pet food industry. The product was developed to provide a greener alternative to fish-sourced omega-3 oils by the aquaculture and pet food industry

Report Coverage:

By Product Type

• Food Grade
• Feed Grade
• Industrial Grade

By Application

• Food & Beverages
• Dietary Supplements
• Pharmaceuticals
• Animal Feed
• Cosmetics & Personal Care
• Biofuels
• Others

By Source

• Microalgae
• Macroalgae (Seaweed)

By Distribution Channel

• Online Retail
• Supermarkets/Hypermarkets
• Pharmacies & Health Stores
• Direct Sales (B2B)

By End-User

• Food and Beverage Industry
• Nutraceutical Industry
• Energy Industry
• Animal Nutrition Industry
• Cosmetics Industry
• Pharmaceutical Industry

By Region

North America

• U.S.
• Canada

Europe

• U.K.
• France
• Germany
• Italy
• Spain
• Rest of Europe

Asia Pacific

• China
• Japan
• India
• Australia
• South Korea
• Singapore
• Rest of Asia Pacific

Latin America

• Brazil
• Argentina
• Mexico
• Rest of Latin America

Middle East & Africa

• GCC Countries
• South Africa
• Rest of the Middle East & Africa

List of Companies:

• Algenol Biotech LLC
• Corbion
• Cellana Inc.
• Global Algae Innovations
• Pond Technologies Inc.
• DSM Nutritional Products AG
• Lonza Group AG
• JC Biotech Pvt. Ltd.
• Runke Bioengineering Co., Ltd.
• Keyuan Biotechnology Co., Ltd
• Bioco Technologies Ltd.
• Fuxing Biotechnology Co., Ltd.
• Huison Biotech Co., Ltd.
• Kingdomway Nutrition Inc.
• Amry Biotechnology Co., Ltd.

Frequently Asked Questions (FAQs)