AstaReal announces plan to further expand US astaxanthin facility as finished product brand hits market

By Hank Schultz contact

- Last updated on GMT

Related tags: Natural algae astaxanthin, Astaxanthin

AstaReal uses a closed photobioreactor production system.
AstaReal uses a closed photobioreactor production system.
Astaxanthin manufacturer AstaReal has announced plans to further expand its production facility in Washington State and has followed other producers of the carotenoid into the direct-to-consumer finished products market.

As the company’s production 59,000-square-foot algae production facility in Moses Lake, WA nears its one-year anniversary, the company announced plans to expand it further with an additional $30 million investment spanning two years. The expansion is expected to create an additional 50 jobs at a facility. AstaReal, a division of Japanese company Fuji Chemical, also has a production facility in Sweden. The company’s links to Washington were recently highlighted with a trade mission visit by Democratic governor Jay Inslee to the company’s headquarters in Japan.

Market size uncertainty

The company said that market demand for the ingredient continues to swell but the reporting of the market size has been somewhat unreliable in the past.

"We understand that the global market, especially US and Japan astaxanthin markets, are growing at more than 30% in the annual growth rate on a quantity basis. And it's expected that the aggressive growth rate is going to continue, although there is no solid estimation about the market growth in the public domain,” ​Mitsunori Nishida, AstaReal Group CEO told NutraIngredients-USA.

Scott Steinford, president of the Natural Algae Astaxanthin Association (NAXA), said the market estimations are getting better over time. Part of the problem continues to be the ingredient’s relatively short history on the market, he said.

“The ability to track the market size and growth is improving. Previous reporting methods were variable due to the calculations coming from limited sources and market information being supplied combining other carotenoids into the sales figures. Current estimates place the global human grade astaxanthin raw material market, post extraction, at slightly below $100 million with global retail estimated at approximately $400 million,” ​Steinford said.

Steinford also said that he believes the most of this market is in the natural algae product (nature identical forms are on the market, most prominently from DSM), though it must be kept in mind that NAXA was founded to promote the algae sourced ingredient.

Consumer brand

AstaReal has also followed Hawaii-based astaxanthin manufacturer Cyanotech into the consumer products market (though unlike Cyanotech it continues to offer bulk ingredients, too). This month finished products under the company’s Astavita consumer product subsidiary went on sale on the company’s website. The ingredient can be promoted for a variety of health indications, the company said.

“The main categories are healthy aging (anti-aging) and sports (muscle). The uniqueness of natural astaxanthin is in its antioxidant capability on mitochondria,” ​said Yasuhiro Ogura, president, Astavita.

"And it's well known that mitochondrial function is tightly related to lifestyle diseases, such as diabetes, cardiovascular dysfunction, or muscle loss, commonly noted in the elderly. So the effectiveness on healthy aging is expected from users who are conscious about those risks and physicians and other healthcare professionals who has such patients. For that same effect on mitochondria, the effectiveness in muscle performance of athletes is also strongly expected

Cost, quality competition

Looming over the astaxanthin supply market are rapidly expanding Chinese algae suppliers. While these companies are potentially formidable competitors, the traditional cost advantage that Chinese firms enjoy in almost any industrial sector is eroding, Steinford said.

“Astaxanthin production is currently labor intensive but production is also technically improving at a fast pace. While Chinese manufacturers might have a cost advantage from a labor perspective; the delta of that advantage is diminishing. More importantly, manufacturers are focusing on quality assurance and market awareness; which are international in both focus and opportunity,” ​Steinford said.

Steinford said that quality and traceability are becoming ever more important in the astaxanthin market as they are in the trade of other ingredients. To that end, NAXA is preparing to launch a major quality initiative for the astaxanthin market at the Supply Side West trade show in October.

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