This forgotten technology could solve the world’s palm oil problem

Palm oil is the world’s most popular vegetable oil, found in half of all supermarket goods and seven out of every 10 personal care products. It’s what gives tortilla chips their crunch, detergents their cleaning power, and toothpaste its smoothness. It’s also used as a biofuel. Since 2016, global palm oil consumption has risen 73 percent.

Yet palm oil, and the unabating appetite for it, is problematic. The clearing of forests to make way for oil palm plantations is a major driver of deforestation in the tropics: Between 1972 and 2015, the world’s two largest palm oil producing nations, Indonesia and Malaysia, lost 16 percent and 47 percent of their forests, respectively, to the crop. Deforestation is linked to a host of environmental problems, such as climate change, soil fertility issues, and poor water quality, among others. Biodiversity suffers a severe blow too, with studies estimating that mammal diversity declines by up to 90 percent when forests are slashed to plant oil palms.

However, an alternative to palm oil may be on the horizon, one that’s just as multifaceted but not as fraught: oil made from microbes.

An old technology revived

Scientists began looking into alternative sources for obtaining edible oil out of necessity, says Philipp Arbter, a biotechnologist at the Technical University of Hamburg in Germany.

When butter and lard were scarce in World War I, German researchers discovered that certain types of yeast also produced oily lipids. Authorities soon established two factories dedicated to making a high-fat paste that was used “in the baking of bread, in dough instead of fat; for spreading on bread instead of butter.”

Those efforts disappeared once the war ended, when there was sufficient supply again from plants and animals, Arbter says.

But interest in microbial oils—those made from yeast, as well as other microorganisms like algae—has seen a revival in recent years as an eco-friendly substitute for palm oil, one that appears more viable than other vegetable oils.

“The technology is actually very old but was never really established in industry, and I always wondered why because it has great potential,” says Arbter. For instance, he says, microbes can be grown quickly in a climate-controlled, compact indoor space to yield potentially high quantities of oil. Earlier this year he cofounded Colipi, one of a handful of emerging startups that are growing and tweaking microbes to produce a synthetic version of palm oil.

Seeking a suitable substitute

As an oil, palm is hard to beat. For a start, it’s an extremely efficient crop—the reason why it’s so cheap compared with other oils. An acre of oil palms—the trees that grow the fruit palm oil is made from—can produce more than 1.35 tons of palm oil annually, at least six times more than other edible oils. Moreover, oil palm thrives year-round in the tropics, grows in a wide variety of soils, and is perennial (lasting up to 25 years), making it “more productive than annual crops like peanuts, soybean, and other oil-producing crops,” says conservation scientist Erik Meijaard, co-chair of the IUCN Oil Crops Task Force.

Palm oil also is unique in that it contains roughly equal parts saturated and unsaturated fats, making it extremely stable chemically. That confers a long shelf life to packaged foods.

Those attributes make finding a suitable substitute somewhat of a holy grail, though microbial oil, with a lipid profile similar to palm oil, might just be up to the task.

Scientists have so far identified more than 40 algae and 70 yeast strains known to be oleaginous, or rich in oil. To harvest that oil in the lab, the microbes are first grown, usually in petri dishes of agar, before being transferred to glass flasks or stainless-steel brewing tanks. They are fed oxygen and sugar—anything ranging from cane sugar to molasses—which kick-starts fermentation and causes the cells to multiply. When the microbes reach a critical mass, which takes a few days, they are popped open to release the oil within.

The tricky part is optimizing the process to extract the most oil.

Seraphim Papanikolaou at the Agricultural University of Athens, a leader in the field of oleaginous yeast research, says there are many moving parts to play with to do that: microbial strain, culture temperature, stirring speed, amount of aeration, type of feedstock and frequency of feeding, and cell lysis method, just to name a few.

If done right, the rewards can be plenty. Papanikolaou has previously achieved oil yields of up to 83 percent, or 8.3 grams of oil for every 10 grams of yeast—the “best reported in literature,” he says. But in general, “it’s not very difficult to get quantities of 50 to 55 percent.”

Microbes as tiny factories

Those potentially high yields are partly what makes microbial oil so attractive as a palm oil alternative.

Additionally, microbial oils promise to be more eco-friendly than palm. Microorganisms can be cultivated independent of climate conditions and without the need for large tracts of land, says food scientist William Chen at Singapore’s Nanyang Technological University. “You basically need a bioreactor…that’s how easy it is,” he says.

Rearing microbes that feed on waste material can further boost sustainability, says Chen. His team, for instance, is exploring whether traditional culture mediums used to grow microalgae can be replaced by brewers’ spent grain or soybean residue. Similarly, researchers from NextVegOil in Germany are reportedly producing oil from the fungus Ustilago maydis fed on corn harvest leftovers, while the Netherlands-based startup NoPalm’s oil is derived from yeast that ferments potato peels and rejected vegetables.

Christopher Chuck, a chemical engineer at the University of Bath in England who has spent nearly a decade working on microbial oil, says they get “their best results, from a sustainability and efficiency point of view,” using food waste such as bread ends.

Perhaps one of microbial oil’s biggest draws is that the organisms producing them can be redesigned using the engineering and computing tools of synthetic biology. Although the ratio of saturated to unsaturated fats must be kept close to 50-50 to mimic palm oil’s properties, researchers have the latitude to play with the types of fats within each category. They could, for instance, swap the cholesterol-inducing palmitic acid for a relatively healthier saturated fatty acid, such as stearic acid, thereby creating a more desirable oil for a consumer market. More quickly, too, since it all happens in a matter of weeks in a lab.

The road to store shelves

Most microbial oil startups are aiming for their first products to be in the beauty and cosmetics sector, rather than food, due to the higher price points they can command and the relatively fewer regulations involved. When asked if the new oil can match palm oil prices, especially when it’s used in food, Chuck says, “We should be in touching distance of the edible oil market” as long as production happens on a large enough scale to bring the price down.

“We have to all figure out how to move the technology better—from lab to scale faster,” says Shara Ticku, CEO and cofounder of C16 Biosciences, a New York-based microbial oil startup backed by Bill Gates, which has so far come the closest to large-scale production. C16 hit a 50,000-liter fermentation milestone in November, and in early 2023 will launch in the United States a hydrating bio oil meant for cosmetics—one of the first firms to bring a microbial oil product to market.

The foray couldn’t come soon enough; by 2050, palm oil production is expected to triple to 240 million tons. With the world’s population predicted to swell to nearly 10 billion in that time, and the demand for lipids forecasted to increase three to fourfold, Ticku says of microbial oils: “We have a mandate to move really quickly to introduce these solutions to the world.”