How Feeding Fish a Long-Lost Fungus Helps Save the World's Trees
(Bloomberg) -- A Finnish company is trying to break the fish industry’s reliance on feed made from soybeans — and the deforestation that can come with it.
The average person eats almost twice as much seafood compared to half a century ago, and the fish on our plates is more likely to have come from a farm than anywhere else. While the fish industry has a smaller carbon footprint than most meats, it’s still dependent on soybeans to feed its stock. The crop is the second-biggest driver of tropical deforestation, including in Brazil’s Amazon rainforest.
That’s where EniferBio Oy comes in. The company’s five biologists spent lockdown in a lab on the border of Helsinki resurrecting a lost fungus called Pekilo. The protein was eaten by pigs and poultry in Finland for decades. It used to be made from byproducts created during paper manufacturing, but disappeared in 1991 when the industry shelved the process that produced the forestry residues.
“I studied biotech in Finland for over half a decade and had never heard of Pekilo,” said Simo Ellila, chief executive and co-founder of EniferBio. “Turns out it was a sleeping giant.”
The agriculture industry, facing increasing scrutiny over the climate impact of traditional feed, is searching for more sustainable alternatives. Giants such as Cargill Inc. and Archer-Daniels-Midland Co. are looking to insects while French oil major Total SE has backed a push to turn captured CO₂ into food for chickens, fish and pigs. The market for feeding fish is set to hit $72 billion by 2025, according to research firm Markets and Markets, from $51 billion last year.
EniferBio’s lab-grown fungus isn’t on sale yet. But results of a first-stage trial released on Nov. 18 found that salmon, the world’s most-traded fish, can digest Pekilo just as easily as meal made of powdered bones and offal. Skretting, the aquaculture research center which conducted the trial, said the results were encouraging and a sign of “a new protein raw material coming our way.”
The European Union is on board too. The bloc’s maritime and fisheries fund granted EniferBio $1.4 million in October, adding to cash that’s already come from venture capital firm Nordic FoodTech VC.
Teni Ekundare, head of investor outreach at ESG solutions firm Fairr Initiative, says investors see the revenue potential of alternative proteins. “Climate change is factoring into almost every investment that exists,” Ekundare said. “Investors that weren’t previously watching this space are now keeping it firmly on their radar.”
Soy makes up over a fifth of aquafeed ingredients, meaning demand for the crop is likely to soar in the future and heap pressure on natural resources. The association with greenhouse gases and deforestation will hinder the agriculture industry’s growth unless novel alternatives are brought in, a 2017 PwC study warned.
Simon Davies, a professor of fish nutrition and aquaculture at Harper Adams University in Newport, U.K., says that single-cell proteins such as Pekilo, known collectively as SCP, have the potential to leap above fishmeal and soybean as the world’s most-used aquafeed. Still, he warned that the scale of production for soy alternatives must reach “enormous levels.”
“Fungi is a great SCP that is high in protein, locally sourced and has low processing costs,” Davies said. “But millions of tons of soy and fishmeal are being imported every year, so we’ll need more and more startups like EniferBio to buck the trend.”
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