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The Yield Lab Asia Pacific Global Aquaculture Challenge - Xylome

This series provides insights into the global array of companies participating in this challenge as innovators or sponsors.

The 8th of this Spotlight Series focuses on Xylome, one of the eight innovation finalists of this program. In the coming weeks leading to the grand Finale on the 7th of October, we will profile the other innovations and sponsors of this challenge.

Xylome is a technology provider for agribusiness, with its yeast-based fish oil substitute.

(Madison WI, USA) Xylome has a solution found deep in bioinformatics and yeast fermentation that could add inexpensive and sustainable nutrients and omega-3 fatty acids to aquaculture feeds, particularly for salmon.

CEO Tom Kelleher and founder Thomas Jeffries--microbiologists with decades of experience in biochemistry, yeasts and fermentation--are chasing alternative ingredients that could solve aquaculture’s reliance on unsustainable feed sources. The underlying thinking is that the nutrients found in genetically engineered yeast could match those found in fish oil, which aquaculture currently obtains from wild capture pelagic fish to farm salmon.

Tom Kelleher, CEO, Xylome
“We have a good sustainability story here,” Kelleher said about Xylome’s yeast technology. “We’ve spent a lot of time studying the genetic expression of fish oil and novel approaches to efficient production of the primary producers of omega-3 oils.”

Multinational agribusiness giants Archer-Daniels-Midland, Cargill and Royal DSM and smaller firms such as Xylome are using biotechnology and genetic engineering to find new sources of omega-3 that can be fed to salmon and other types of finfish and shellfish.

The global salmon industry reduced its use of fish oil obtained from wild capture forage fish to about 12% of total feed on average in 2020, from 24% in 1990, according to leading producer Mowi. Many experts agree that fish oil content cannot be further reduced without compromising fish health and the omega-3 sourcing labels that the industry uses to promote salmon in helping cardiovascular health.

Living through the rise and fall of the U.S. ethanol industry, Kelleher and Jeffries founded Xylome in 2013 to develop technology to ferment cellulosic and hemicelullosic sugars that are left-over residuals of ethanol production. The waste stillages can be adapted to high value food ingredients and other products, which need improved sustainability.

Xylome Team. Left to Right: Ashley Zitzow, Tom Jeffries (Founder), Richard Taylor

Xylome won a U.S. Department of Energy grant to develop a palm oil substitute from corn stover that is an accessible agricultural byproduct within reach of current ethanol production facilities. Corn stalks are in ample supply in the U.S., as are other fermentable feedstocks, that Kelleher and the Xylome team realized fit into the Circularity-by-Design concepts were part of the Xylome mission. For example, the high nutrient residue from making Xylome’s palm oil substitute could become an important feedstock for the production of salmon feed ingredients. Using the liquid residue to produce aquaculture feed would allow Xylome to offer a truly sustainable product, Kelleher said.

"Aquafeed containing heat-treated yeast in combination with other ingredients could cost as little as $0.65 a pound compared to $0.95 a pound for traditional aquafeed. That price target is especially feasible when combined with a soy protein base", said Kelleher, who attributed the pivot to soy protein as a discovery arising from Xylome’s participation in The Yield Lab Asia Pacific’s Global Aquaculture Challenge (GAC). The program brought the company into contact with sponsoring organizations such as the U.S. Soybean Export Council and aquaculture experts through internal mentorship sessions.

Xylome sees vast potential for its product as investors pour money into land-based salmon farms in the U.S. that use recirculating aquaculture system (RAS) technology. Xylome is already being mentored-by and working with U.S. salmon company AquaBounty.

Xylome's Hyperlipogenic Yeast

Xylome continues to refine its yeast-based palm oil substitute and yeast-based fish oil substitute and is developing the technology to produce its aquaculture feed ingredient for further testing in real-world settings. The Madison, Wisconsin-based Xylome ultimately sees itself as a technology provider and hopes through the GAC program to partner with a larger company to take its feed product to market.

There are plenty of potential candidates, including agribusiness companies and ethanol makers that could potentially repurpose idle factory capacity to make sustainable aquafeed, Kelleher said.

8 Sep 2021.

Matt Craze and Oriana Aguillon, Spheric Research.



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