Why Bangladesh’s Seaweed Sector Remains Stuck in Shallow Waters

The seaweed sector in Bangladesh is stalled at a growth block due to a lack of strategic coordination among stakeholders, holding back progress beyond the research and development phase. Seaweed, a type of marine algae, grows in coastal areas worldwide and is abundantly found in the tropics and temperate zones. For Bangladesh, with its 710 km of coastline and roughly 25,000 km² of coastal and shallow marine area, the natural conditions for seaweed cultivation are highly favorable.

Yet, the country has barely scratched the surface of this opportunity. While exact species data in Bangladesh remains inconsistent, triangulated insights from government, research, and academic sources suggest the presence of nearly 200 species in Bangladeshi waters, 14 of which hold commercial value.^[1] Among them, Hypnea musciformis, Gracilaria tenuistipitata, Ulva intestinalis, and Ulva lactuca have drawn attention for small-scale experimental farming. These species can feed into diverse industries, from food and pharmaceuticals to carrageenan and agar production, cosmetics, biofuels, and industrial inputs. In practice, however, cultivation remains largely confined to research and pilot phases that leave the sector’s commercial potential largely untapped. 

Globally, seaweed is a powerhouse with versatile applications across many sectors, including food, medicine, cosmetics, animal feed, fertilizers, biofuels, and more. The global seaweed market was valued at around USD 18^[2] billion in 2024 and is projected to expand to USD 29 billion by 2030.^[3] Turning to Bangladesh, the local seaweed market is still nascent, with no established value chain or consistent reporting on production volumes or market size.

However, an estimation can be derived from available data and indicators. The primary consumers of locally produced seaweed are the ethnic people from the Rakhain, Chakma, and Marma communities, who are familiar with seaweed and consume it as part of their traditional diets. Locally produced seaweed is traded in Cox’s Bazar and Bandarban. In Cox’s Bazar, local seaweed, primarily Gracilaria, is sold in the Burmese Market and nearby village bazaars. From there, distribution extends into Bandarban, reaching local markets in Ramu, Alikadam, and Rangafali.^[4] This district, with a 60% ethnic population, acts as a regional hub for tribal wholesalers.^[5]

According to the Census & Household Survey 2022, Bangladesh has about 1,650,159 indigenous people; Chakma, Marma, and Rakhain together number ~718,755. In the Chattogram region (≈990,860 indigenous people), applying the same share gives ~431,619 from these three groups.^[6] The active seaweed market is concentrated in Cox’s Bazar and the Chittagong Hill Tracts, where many are exposed to and buy seaweed, but not all are consumers. Conservatively estimating, due to lack of available data, that 300,000 people are active consumers, averaging 2 kg dried seaweed per person per year (≈8 kg wet).

With dried seaweed priced at BDT 100–400/kg, annual household demand could reach BDT 240,000,000 in a best-case scenario, roughly USD 1.9 million. In parallel, it is estimated that around 30 Pan-Asian restaurants and specialized supermarkets across Bangladesh collectively import about 1,500 kg of dried seaweed each month, totaling approximately 18,000 kg per year. At an average price of BDT 1,000 per kg, this amounts to BDT 18,000,000 (USD 147.21 thousand). These figures are a tentative estimate and should be interpreted with caution, as precise data on consumption and market size are not available.

Additionally, At the national level, Bangladesh continues to rely heavily on imports for seaweed-related products and agar-agar. In 2023–2024, imports across these categories totaled approximately BDT 46,084.71 crore (USD 410.17 million), though these figures cover broader categories and are not exclusive to seaweed or agar-agar.^[7]

If the potential of seaweed could be fully realized through the expansion of the farmer base, producing value-added products, supplements, nutraceuticals, applications for the animal feed industry, and similar uses, Bangladesh’s locally produced seaweed market could expand further and reduce import dependency. Even modest substitution of imported volumes could create meaningful income opportunities for producers and processors, justify investments in drying, quality control, and aggregation, and help shift the sector from pilot projects to a commercially viable industry.

Figure: Comparative Scenario of the Local and Global Seaweed Sector; Source: Author’s Illustration

Research Efforts Without Breakthroughs

Despite more than a decade of research and small-scale experimental farming, Bangladesh’s seaweed sector remains in its infancy, underutilized and unable to progress beyond project-driven initiatives. Some of the major projects include,

• Seaweeds of the Bangladesh Coast by Bangladesh Fisheries Research Institute (BFRI)^[8]
• Baseline Survey Report on Seaweed Cultivation, Processing, and Marketing for Employment Generation in Bangladesh’s Coastal Poor Communities by Integrated Development Foundation (IDF) Bangladesh^[9]
• Seaweed Experimentation: Ray of Hope for the Coastal Belt Fishers’ Families Contributing Blue Economy in Bangladesh by UNDP^[10]
• Seaweeds for the sustainable blue economy development: A study from the south east coast of Bangladesh by Zahidul U. Ahmed, et al.^[11]
• ECOFISH II Project implemented by WorldFish^[12]
• Rapid Market Analysis of the Seaweed Value Chain in Cox’s Bazar by the International Labour Organization (ILO)^[13]

Numerous institutions, such as the Bangladesh Fisheries Research Institute (BFRI), Bangladesh Agricultural Research Institute (BARI), Bangladesh Oceanographic Research Institute (BORI), the Department of Fisheries (DoF), and academic bodies like Chittagong Veterinary and Animal Sciences University (CVASU) and Patuakhali Science and Technology University (PSTU), alongside international agencies like Japan International Cooperation Agency (JICA) and several NGO-led programs, invested in research and related interventions over the years.

The Supply-Side Constraints

Despite considerable efforts and investments, the sector has yet to translate into tangible growth. Several systemic bottlenecks continue to stifle momentum, including the absence of critical seaweed value chain stakeholders, such as input market actors, processors, retailers, and exporters, while a coherent market model has yet to emerge. Bureaucratic overlaps and competition further complicate coordination. Resultingly, the sector remains fragmented and without a clear growth pathway.

Adding to this challenge, much of the research output has remained confined to academic publications, rarely translated into practical, market-oriented solutions or transferred to private actors who could drive commercialization. Meanwhile, the sector is not prioritized for concessional financing, and the private sector and entrepreneurs, crucial for commercialization and scale, remain disengaged, discouraged by weak market demand, frequent post-harvest losses that discourage consistent production, low market awareness, and the absence of enabling regulatory frameworks.

At the production level, farmers remain trapped in project dependency, confined to small-scale, project-driven activities. Their reliance on external support, basic cultivation training, tools, cash incentives in the form of wages, and occasional buy-back arrangements (often for only a fraction of their produce) has stifled organic growth in the sector. Project-based cash incentives, though well-intentioned, have created distortionary effects, restricting the natural evolution of a sustainable and commercially viable seaweed industry in Bangladesh.

Figure: Farmers’ Trap on the Supply Side; Source: Author’s Illustration

Farmers are hesitant to produce without a guaranteed market, while industries cannot establish themselves without a consistent supply. This fundamental market failure is a core reason for the sector’s stagnation. So far, only about 500 farmers are active in seaweed farming in Bangladesh’s coastal belts. Among them, a handful in Cox’s Bazar manage to sell small amounts in local indigenous markets there and in the hill tract regions. Interestingly, many of these farmers also play the role of traders, wearing multiple hats within the value chain.

They operate as legacy sellers, having earned trust and familiarity among local consumers. Beyond these micro-pockets of trade, however, there are no large-scale buyers or consistent commitments from the private sector, leaving supply unstable. Price volatility further erodes profitability, with drastic drops during peak harvests caused by oversupply and limited demand, often leading to post-harvest losses. Consequently, many consider abandoning seaweed cultivation in favor of more reliable livelihood options, preferring stable income from coastal activities such as fishing, mussel farming, or shrimp cultivation, rather than oscillating between seaweed and other occupations.

This cycle of instability perpetuates import dependency for raw materials and value-added products like agar and pharmaceuticals, despite the strong commercial potential of several coastal species. As a result, the sector remains trapped in a cycle of unrealized potential.

The Demand-Side Bottlenecks

On the demand side, the picture is equally discouraging. Currently, seaweed consumption remains confined to niche segments. In coastal and hill tract communities, it is consumed traditionally by indigenous groups, while in urban areas, demand comes from a small set of consumers drawn to Pan-Asian cuisine trends. Beyond these pockets, most consumers remain unaware of seaweed’s uses or perceive it as unhygienic, slimy, or otherwise unfit for consumption—misconceptions that limit broader adoption. Its taste also does not align with mainstream preferences, creating further barriers to adoption. Compounding these challenges, reduced shelf life and safety, due to inadequate cleaning, processing, and preservation, make locally produced seaweed appear inferior to imports and erode consumer confidence.

Industrial and commercial actors, including the HORECA sector, food processors, animal feed producers, and pharmaceutical companies, remain largely unaware of the wide range of applications seaweed offers. With minimal value-added products and early-stage diversification technologies, seaweed has yet to enter mainstream diets, whether locally produced or imported. These symptoms are rooted in deeper structural issues. Developing a domestic market is costly and challenging amid global competition, and large-scale commercial production is virtually nonexistent. Formal exporters are currently absent, which leaves Bangladesh largely disconnected from the global market. The country continues to rely on imports for products like agar and Carrageenan. Government support, policy coordination, and product certification remain limited. Together, these factors create a persistent demand-side bottleneck that stifles the sector’s growth and its ability to fulfill its commercial potential.

Figure: Demand-side Bottlenecks; Source: Author’s Illustration

Consequently, Bangladesh misses a significant opportunity to harness seaweed for advancing the Blue Economy, boosting economic growth, strengthening coastal livelihoods, and accelerating progress toward the Sustainable Development Goals.

Structural Barriers Holding Back Growth

Bangladesh’s seaweed sector is held back by a tangled web of structural barriers that continue to cripple its growth. At the core, government policies remain superficial and lack any specific directives to guide industry development. Environmental regulations are ambiguous and inconsistently enforced, particularly in ecologically sensitive areas, while cultivation land is limited and unprotected due to the absence of designated mariculture zones. The situation is further aggravated by the lack of food safety and quality certifications, both domestic (BSTI) and international (ASC-MSC), which undermines market confidence and leaves high-value opportunities unclaimed. Seaweed is also currently not in the government’s priority export list.

Figure: The Tangled Web of Structural Barriers; Source: Author’s Illustration

The challenges don’t end there. Coordination and knowledge transfer failures compound the sector’s stagnation. Research institutions and government bodies frequently operate in silos, preventing innovations from reaching private enterprises. Without a central coordinating authority, the sector remains incapable of achieving scale. Unless urgent measures are taken to establish clear policies, enforce quality standards, coordinate stakeholders, and create market incentives, Bangladesh risks letting one of its promising coastal resources wither on the sidelines.

Steps Forward

So far, development efforts in Bangladesh’s seaweed sector have largely focused on farmer training, improved farming practices, and variety testing. These efforts have laid a solid foundation, knowledge of production has already spread, and many farmers are now experimenting independently. The next step should be to expand the existing farmer base and leverage this growing capacity through ventures and entrepreneurs who can drive industrial-scale growth and tap into seaweed business opportunities. Seaweed has vast industrial potential and applications, and relying solely on small, niche markets will not suffice. Dedicated exporters are also critical to integrate the sector into global value chains and accelerate its development. What is required are bold strategies, larger players, and industrial-scale investments to move beyond isolated pockets of demand toward mid- and large-scale commercialization.

Achieving this transformation will not be possible through incremental efforts alone. Bangladesh’s seaweed sector is an all-or-nothing opportunity that demands heavy private-sector investment, supported by coordinated strategic plans and public-sector development. Projects and research-focused initiatives are insufficient. Currently, industrial-scale operations, market creation, and value-added commercialization can unlock the sector’s full potential.

Figure: Way Forward to Connect with the Global Market; Source: Author’s illustration

To realize this potential, the sector needs to be supported by a dedicated coordinating body, clear policies, and strong quality standards. Private players must drive B2B demand from FMCG, food processing, and pharmaceutical companies, while industrial-scale piloting focuses on high-value products such as agar, bio-stimulants, and animal feed.

Figure: Seaweed Applications by Market Potential; Source: Author’s illustration

Complementing these efforts, financial support, investments, post-harvest infrastructure, and capacity-building initiatives are imperative to enable farmers and entrepreneurs to scale effectively. R&D on high-value species, climate-resilient cultivation techniques, and social marketing campaigns to boost domestic demand are equally essential to ensure the sector’s long-term sustainability. 

References

^[1] Seaweeds of Bangladesh Coast | Bangladesh Fisheries Research Institut

^[2] Global Seaweed New and Emerging Markets Report 2023 | The World Bank

^[3] Commercial Seaweed Market Industry Report | Fortune Business Insight

^[4] LightCastle Internal

^[5] Population and Household Census 2022 | Bangladesh Bureau of Statistics

^[6] Annual Import Payment of Goods and Services 2023-2024 | Bangladesh Bank 

^[7] Seaweeds of Bangladesh Coast | Bangladesh Fisheries Research Institute

^[8] Baseline Survey Report on Seaweed Cultivation, Processing, and Marketing for Employment Generation in Bangladesh’s Coastal Poor Communities | Researchgate

^[9] Seaweed Experimentation for Coastal Communities | UNDP

^[10] Seaweeds for the sustainable blue economy development: A study from the south east coast of Bangladesh | ScienceDirect

^[11] ECOFISH II Project | WorldFish

^[12] Rapid Market Analysis of Seaweed Value Chain in Cox’s Bazar Bangladesh | ILO