It was very interesting to read about algae being used to produce omega 3 for human health supplements. If algae oil becomes a relatively common product the health market will get saturated by omega 3 fairly quickly, but it may help early mover algae companies like AEB get going.
Because of the scale of the energy industry vs. the health industry the omega 3 income would become negligible if algae oil (energy) was economically viable - the energy industry would want far more energy oil, and there would be an excess of omega 3 for the health industry. If the article's information is correct, the omega 3 itself is economically viable even if the biofuel is a worthless biproduct (which obviously it isn't). So, even if algae oil is not economically viable, there may be an omega 3 industry producing it as a biproduct. In that scenario the industry will be limited by the value of omega 3, which wouldn't take much to saturate (but hey, in that scenario who cares - the biofuel is viable on its own and the omega 3 just helps establish the early companies).
Obviously it's all very much pie in the sky stuff at this stage, the market it clearly almost as unconvinced as I am. With good reason the market tends to react when things are more certain. It's an interesting story though.
AEB Price at posting:
17.5¢ Sentiment: Sell Disclosure: Not Held
