Royal DSM and Evonik today announced their intention to establish a joint venture for omega-3 fatty acid products from natural marine algae for animal nutrition.
Worldwide fish oil production is approximately one million metric tons per year. Most of the fish oil is used in aquaculture, mainly for fat-rich fish species, such as salmon. The limited wild fish stocks restrict the amount of fish oil available and thus the growth of the aquaculture industry.
Currently, the industry uses about 75% of the annual production of fish oil. The new joint venture will mean that Evonik and DSM can offer a sustainable non-fish alternative, derived from natural marine algae. The product will be aimed at initial applications in salmon aquaculture and pet food.
The joint venture follows the joint development agreement, signed in July 2015. Under this agreement, Evonik and DSM have jointly worked on the development of products and the manufacturing process and explored opportunities for commercialization. Both companies achieved positive results in the development of the product while extensively working with the entire value chain, including fish feed producers, fish farmers and retailers.
DSM Nutritional Products and Evonik Nutrition & Care will each hold a 50% share in the joint venture and co-own the production facility in the United States, which will be built at an existing site of Evonik and is expected to come on stream in 2019. The joint venture plans to invest around US$ 200 million in the facility (USD 100 million by each party over circa 2 years). The initial annual production capacity will meet roughly 15% of the total current annual demand for EPA and DHA by the salmon aquaculture industry. The set-up of the joint venture, to be named Veramaris and headquartered in the Netherlands, will be finalised subject to regulatory approvals and other customary closing conditions.