Prime Highlight
- ÄIO has received a €1.2 million grant from Enterprise Estonia to advance its FERM-OIL project focused on sustainable, food-grade fats produced through fermentation.
- The project aims to reduce reliance on animal fats and palm oil by scaling non-animal lipid production for use in plant-based and alternative protein foods.
Key Facts
- The total budget for the FERM-OIL project is €2.3 million, with ÄIO having raised €6.8 million in seed funding and about €3 million in public and EU grants.
- Over the next three years, ÄIO plans to scale its Flavoured Fat product to industrial production and reach technology readiness level six.
Background
Estonian biotechnology startup ÄIO has received a €1.2 million grant from Enterprise Estonia to advance its FERM-OIL project, which focuses on producing sustainable food-grade fats and oils through fermentation. The total budget for the project stands at €2.3 million.
Founded in 2022 as a spin-off from Tallinn University of Technology, ÄIO develops non-animal fats using specialised yeast. The process converts wood and agricultural by-products, such as sugars from sawdust, into lipid-rich ingredients. The company aims to cut dependence on animal fats and palm oil by offering a faster and lower-impact alternative.
ÄIO has so far raised €6.8 million in seed funding and secured about €3 million in grants from public and European funding bodies. The new grant will help the company address a key challenge in the food industry: the lack of sustainable lipid ingredients that work well with plant-based and alternative protein products.
While innovation in alternative proteins has moved quickly, many lipid alternatives struggle to scale or meet industrial and safety standards. FERM-OIL is designed to bridge this gap by supporting the move from laboratory testing to full-scale food production.
Over the next three years, ÄIO will scale its Flavoured Fat product from lab and pilot stages to industrial manufacturing. The product is a lipid-rich yeast biomass that adds umami flavour and smooth texture to foods. The work will include improving the fermentation process, testing second-generation feedstocks from food and forestry side-streams, and transferring production to an industrial manufacturing partner.
The project will also generate safety data needed for regulatory approval and assess shelf life and product quality. By the end of the project, ÄIO aims to reach technology readiness level six, showing it is ready for industrial production.
Chief executive Nemailla Bonturi said the grant will help prove that fermentation-based lipids can be produced reliably at scale and become part of future food systems.
