Ocean Impact Investments: A Snap Shot Into Seaweed

Updated: 6 hours ago

By Patricia Chu | 14 October 2020


Mana Impact seeks to invest in early-stage companies focused on solving issues around ocean health, sustainable aquaculture as a food source, and circular systems. One particular area that has gained our interest is seaweed (also known as "Macroalgae") given its capability to sequester carbon, its plethora of other uses, such as in fertilisers, biostimulants, bioplastics and health products.


"Seaweed Farming, Nusa Lembongan, Bali" by yeowatzup is licensed under CC BY 2.0

Our Ocean is An Important Source of Livelihood


The ocean plays a key role in the health of our planet as it produces over half of the world's oxygen and absorbs nearly one-third of the total carbon dioxide emitted from human activities. More than 3 billion people depend on marine and coastal biodiversity for their livelihoods, many of them based in the Asia Pacific region.


Our Ocean is Under Threat


Despite their incontrovertible importance, oceans are today under enormous threat and “under siege” from a variety of areas, including: Overfishing; ocean pollution; the effects of climate change on rising sea levels; increases in global temperatures that cause ocean acidification; and the bleaching of corals, which in turn has a significant effect on marine biodiversity and thus the coastal economies.


Seaweed Industry in Asia


Seaweed is classified into three main types: Red, Green and Brown. The colour is a function of the distance to the surface as well as the quantity and type of light that the seaweed absorbs through photosynthesis. Red and some types of brown seaweed are typically used for human consumption through its utility as a binder for food products. Other types of brown and green seaweed are mostly eaten raw and are good sources of fiber, protein and minerals for human consumption.[1]



Source: European Commission

The global seaweed market is worth more than US$6 billion, approximately 12 million tons of seaweed (according to FAO). The largest producers of seaweed are in Asia are China, Indonesia, Philippines, South Korea and Japan. Historically, seaweed has been produced by smallholder farmers as a supplement to fishing activities. These days, North Asia (China, Japan and Korea) have more large-scale industrialized facilities to grow, harvest and process seaweed. Southeast Asia, however, continues to have seaweed grown predominantly by smallholder farmers.


Most of us know seaweed as food, made famous globally especially through Japanese and Korean cuisine, though it is actually present today in many Western-type foods as well. Though hardly visible, seaweed is used in the production of foods such as yoghurts, gelatin, ice cream, and even toothpaste. In addition to being a source of food, the uses of seaweed range from being an ingredient for bioplastic material all the way to being used to produce silica, which is a critical material needed for the production of PV panels.


New Trends and Applications of Seaweed in Different Sectors


The global production of seaweed has been challenged on multiple fronts: climate change – which raises ocean temperatures and affects seaweed growth; as well as damage to the ecosystems in which seaweed thrives. Consequently, production yields of seaweed have been a major challenge for seaweed farmers. Seaweed seed genetics is an area that deserves further attention in order to improve and maximize yields. Climate-resilient strands of seaweed that can provide better yields would support the growth of the industry as well as those communities that rely on the economic activity along the seaweed supply chain. An example of a company working on this is Seadling, based in Malaysia, that produces Kappaphycus (red seaweed) seedlings that are more resilient to temperature changes.

Seaweed is also being used as an alternative material to plastics. Some of the companies that are undergoing R&D to produce bioplastics include Rhodomaxx in Malaysia, Marine Innovation in Korea and Oceanium in Scotland. Other smart uses of seaweed are as biofertilizers, replacing chemical inputs on land and thereby avoiding run-offs which pollute the ocean. Leili produces biostimulants which improve soil health. Similarly, seaweed is also being utilized as an alternative to textiles, which serves two purposes. Primarily, it reduces the need of water required to manufacture conventional textiles; but equally important, the seaweed alternative reduces ocean pollution as conventional textiles contain synthetic plastic fibers, which contribute to microplastic pollution in the ocean. Algalife has developed pigments and fibers from algae to create alternative textiles.


In recent years, there has been a general augmented expectation to use a specific type of red seaweed called Asparagopsis as feed supplements for cattle as it has shown to cause reductions in the amount of methane being emitted. There are several companies working to bring this seaweed to commercial scale: Symbrosia, part of the Hatch accelerator cohort of companies, is one of them. Futurefeed, an initiative spearheaded by CSIRO, the Australian research organization is also working on scaling the production.


Growing seaweed in deep sea is another trend that we are observing in order to achieve the economies of scale– as opposed to coastal waters, as it is being done by fishermen today. Growing in deep ocean waters, however, is more sophisticated and requires heavier capital investments including more complicated and bigger infrastructure to grow, harvest and transport the seaweed. This transformation will require a much more mechanized process, which then raises the question of whether it displaces farmers livelihoods and fosters the creation of an industrialized sea farming system, which destroys the environment. Ocean Rainforest in the Faroe Islands has developed an open sea cultivation structure and Sea6 has created mechanized harvesting tractor, both of which are highly mechanical solutions, which depend more on capital investments rather than labor or skills improvement.


Mana Impact's Perspective

Our view is that this sector will grow, but to scale it without negatively impacting marine biodiversity and displacing smallholder farmers will be crucial. At Mana, we continue to keep an eye in this space both regionally and internationally. Contact us if you are interested in the sector, working in the sector or keen to invest in the sector as we are open to collaboration.




[1] Read more about the science of seaweed at: http://www.fao.org/3/y4765e/y4765e04.htm

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