EU Pours €350 Million into Fermentation to Become Food Innovation Powerhouse

Courtesy: Melt & Marble

Fermentation tanks could soon be as vital to Europe’s future as wind turbines and solar panels. With climate pressures mounting and global food systems under increasing strain, the European Commission has launched a sweeping “Strategy for European Life Sciences,” a roadmap designed to leverage science and biotech to transform how the continent produces, consumes, and sustains its food.

Central to this plan is a €350 million investment aimed at advancing biomass and precision fermentation—two of the most promising technological frontiers in sustainable food innovation. By accelerating these fields, the EU aims not only to reduce its reliance on imports and lower food system emissions but also to build a competitive edge in the emerging global protein economy.

Fermentation as Food Infrastructure

Fermentation has been part of the human diet for millennia—used to make bread, cheese, wine, and yogurt—but its industrial applications are evolving rapidly. The Commission’s strategy identifies two fermentation approaches as key to Europe’s biotech-led food future.

Biomass fermentation uses microorganisms to convert agricultural by-products such as sugar beet pulp, wheat straw, or potato skins into protein-rich food. This process yields high-quality ingredients that can be shaped into meat alternatives or functional food components with minimal resource input.

Precision fermentation, on the other hand, programs microbes to produce specific target compounds—like casein for dairy, heme for umami, or fats that mimic animal lipids. Though long used in traditional food processing, it is now being expanded to develop entirely new classes of ingredients, from animal-free cheese proteins to palm oil alternatives.

Startups Leading the Charge

Europe’s innovation pipeline in this space is already robust. German startup Formo has become one of the continent’s highest-profile micro-fermentation ventures, using genetically programmed fungi to create dairy proteins. Formo’s koji-based cheeses, including cream cheese and blue cheese analogues, are already being piloted in retail environments like Rewe and Metro. In January 2025, the company secured a €35 million venture loan from the European Investment Bank to accelerate its path to regulatory approval and expand production capacity—an endorsement of biotech as a national economic driver.

Sweden’s Melt & Marble is another standout. The company uses precision fermentation to produce fats that replicate the flavor and mouthfeel of animal-derived lipids. Its “MeatyMarble” and “DairyMarble” fat lines are tailored for plant-based meat and dairy applications, offering alternatives to environmentally damaging oils like palm and coconut. Having secured EU grants from both Horizon Europe and the European Innovation Council, Melt & Marble is now scaling its operations from cubic-metre reactors toward tens of cubic metres by 2025.

Other European players include MicroHarvest, working on biomass fermentation to rapidly grow single-cell protein from agricultural waste, and Nosh.bio, using fungal strains to create whole-cut meat alternatives. Together, these companies reflect a broader European momentum that the Commission is keen to support.

Confronting the Scale-Up Barrier

While innovation is thriving, scaling remains a formidable hurdle. Many fermentation startups lack access to pilot-scale infrastructure or face regulatory delays that stall commercialisation. The EU’s new strategy takes direct aim at these bottlenecks.

The plan includes €150 million in Horizon Europe funding to support sustainable bioeconomy solutions and help bring fermentation-based products to market. A further €200 million is earmarked for 2026–2027 to foster collaboration between researchers and industry players, accelerate tech transfer, and expand production infrastructure.

A strategic research agenda on food systems will accompany the investment, focused on improving the taste, texture, and affordability of next-generation foods. The Commission recognises that consumer acceptance hinges not just on sustainability credentials but on sensory quality—and that even the best technologies will stall without public trust.

The Ultra-Processed Paradox

That trust remains a fragile commodity. Despite growing evidence that plant-based and fermentation-derived foods can reduce cholesterol, improve gut health, and lower the risk of certain cancers, public opinion is still clouded by confusion around “ultra-processed” foods.

This categorisation, often used without nuance, has become a catch-all that lumps together junk foods with scientifically designed, nutritionally advanced meat and dairy alternatives. Advocacy groups such as the Physicians Association for Nutrition (PAN) and the Good Food Institute Europe (GFI Europe) argue that more precise public communication is essential.

“It’s great to see the Commission recognising the central role that food innovation can play in boosting Europe’s life sciences sector,” said Lea Seyfarth, policy officer at GFI Europe. “And it’s even more encouraging to see support for transformative technologies like fermentation—technologies that are central to the EU’s goals around sustainability, food security, and economic growth.”

Policy Momentum and Market Signals

The EU’s strategy lands at a time of growing political alignment. The incoming Danish Presidency of the EU Council has flagged food biotech as a strategic priority, suggesting a wider bloc-level commitment to accelerating food system transformation.

Financial signals are equally encouraging. According to GFI Europe, alternative protein companies in Europe raised €470 million in 2024, with nearly half of that flowing into fermentation startups. Meanwhile, a GFI-cited economic analysis projects that, with sustained policy support, the alternative protein sector could generate €65 billion for Germany’s economy and create 250,000 new jobs by 2045.

Several EU member states are already translating this vision into infrastructure. The Netherlands has opened two large-scale fermentation hubs focused on scaling cultivated and microbial proteins. Germany, backed by its own national bioeconomy strategy, is positioning fermentation as a cornerstone of both its climate and innovation policies.

A Strategic Food Future

What makes this strategy distinct is its emphasis on Europe’s self-sufficiency. As climate shocks, geopolitical tension, and supply chain disruptions continue to destabilise food imports, the EU is looking inward—to its research labs, bioreactors, and startup ecosystems—for answers.

The fermentation roadmap is not just about supporting innovation for innovation’s sake. It’s a calculated investment in reshaping Europe’s food infrastructure, building climate resilience, and redefining how the continent nourishes itself in a resource-constrained world.

With pioneers like Formo and Melt & Marble at the helm, and with Brussels signalling long-term political and financial commitment, the EU is carving out a leadership position in food biotech. If successful, it won’t just be food on the plate that changes—it’ll be the entire system that brings it there.