Calysta raises money for fish food

Bay Area biotech firm Calysta has raised $40 million in a fourth round of funding from strategic and venture capital investors. The company will use the funds to scale up production of a new type of fish feed, made from natural gas, with corporate partner Cargill.

Farm-raised fish, specifically salmon, trout, and shrimp, are fed high-protein diets that include fish meal from small, wild-caught species. But overfishing and higher prices are driving a search for alternative sources of easy-to-digest protein.

Calysta’s product, called FeedKind, is made from protein-rich, single-cell bacteria that live in industrial fermenters, where they digest methane and turn it into protein. Although the company says aquaculture is its first target market, the protein could also be used to feed farm animals and pets.

Japan’s Mitsui & Co., which has a nutrition and agriculture business unit, led the funding round. Other investors included the Singapore investment firm Temasek along with earlier investors Cargill, Pangaea Ventures, Aqua-Spark, and others.

On April 26, Calysta and Cargill broke ground on a commercial-scale manufacturing plant for FeedKind at Cargill’s President’s Island property in Memphis. Set to begin production in 2019, the plant will have an initial capacity of 20,000 metric tons per year but could expand to as much as 200,000 metric tons after a second phase is completed.

The companies say the Memphis facility will be the world’s largest gas fermentation operation. The site will eventually house 20 fermenters, each about 450 m² in size, and several dryers the height of six-story buildings.