The company, which is also exploring new technologies that could boost its presence in the functional food market, was speaking to NutraIngredients-USA.com after announcing deals with two key distributors in the US.
Together, the distributors represented close to 30 percent of the US food, drug and mass merchandise nutraceuticals channel, claimed CFO André Godin. “Following initial commitments from these large distributors, we estimate a minimum volume of 50,000 kg per year.”
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The first phase of the expansion at Neptune’s facility in Sherbrooke, Quebec, should be completed by March 2012, and would be achieved without a plant shutdown, said finance director Frédéric Harland.
Longer-term, Neptune was exploring other locations, he said. “We are considering a plant at a different location. I cannot disclose more on this matter.
“With what we have in our pipeline, we will need close to 500,000kg by 2014. The first phase will get us to 250,000kg, the second phase to 350,000, and the last one close to 500,000kg.”
Krill, claims and functional foods
US customers were making a range of structure/function claims on pack about Neptune’s krill oil, covering joint health, cardiovascular health, PMS and antioxidant benefits, said R&D director Wael Massrieh.
While the initial focus had been on dietary supplements, there had also been new developments on the functional foods front with NKO (Neptune Krill Oil) now successfully incorporated into “several foods including yogurt, health bars and some juices”, said Massrieh.
Although krill oil has more antioxidants in it than fish oil, and was therefore more stable, it was still quite challenging to use in some food applications, he said.
“[However], we recently discovered new technology that could be suitable to microencapsulate the oil that would offer a powder form of NKO which would be much easier to incorporate into more foods.”
Differentiation in the market
Neptune’s major rival in the krill oil market is Norwegian firm Aker Biomarine, which supplies the Superba krill oil brand.
However, Neptune's patented extraction process used “a better solvent, which ensures a better efficiency of oil extraction”, was more stable, and higher in antioxidants, claimed Massrieh.
He added: ”To this day only Neptune has demonstrated clinically proven human health benefits in cardiovascular, joint, cognitive and women's health.”
Currency headaches
Neptune, which reported a 32 percent hike in sales to CAN $16.6m in 2011 had suffered from having to translate sales in US dollars to Canadian dollars, said Harland.
“A few years ago you’d get 1.25 [Canadian dollars for one US dollar] and now you get 0.97 [Canadian dollars to one US dollar], which has a direct impact on our revenues as 65 percent of our sales are in US dollars.”
What is so special about krill oil?
Krill are deepwater marine planktonic crustaceans that look like tiny shrimps.
Nutritionally, krill oil is an excellent source of the long-chain omega-3 fatty acids EPA and DHA, which are rendered more bioavilable because they are carried by phospholipids rather than triglycerides (as in fish oil). It also naturally contains antioxidants including astaxanthin, as well as vitamins E and A, which makes it more stable than other sources of polyunsaturated fatty acids, claimed Neptune.
The harvesting of Antarctic krill for human consumption (as opposed to fish feed) is relatively recent and is monitored by international organization the Commission for the Conservation of Antarctic Marine Living Resources.