Inside Glen Courtright's 20,000-square-foot complex on the outskirts of Dayton, Ohio, there are rows and rows of large bins. From a short distance, these bins appear to be full of loose grains, but get a bit closer, and you'll see that the grains are actually thousands upon thousands of squirming, wriggling larvae. With a bare hand, Courtright grabs a heaping scoop of the critters and delicately pours them back in. They immediately go back to work, munching on food scraps. "They really are little miracles," he says.

Courtright isn't just an insect enthusiast. His company, EnviroFlight, aims to turn these black soldier fly larvae into a low-cost, high-protein feed for livestock, starting with fish. "Each bin will produce upwards of 40 pounds of live insects every 10 days," says Courtright. Because these can be stacked five tall, "every 10 days, we produce the protein equivalent of one pig in a 7-square-foot space," he says with a satisfied grin. If Courtright can succeed at breeding these bugs on an industrial scale—and convince regulators to approve his bug-based livestock feed—he could transform the food industry.

Once you get past the ick factor, the idea is logical. Much of the traditional livestock feed produced by the $370 billion global industry is composed of crops such as corn and soybeans, which are expensive and compete for resources with human food. Livestock feed accounts for 60 percent to 70 percent of food production costs. Even fishmeal, a fish-based ingredient used for farmed fish, pigs, and chickens, can be costly. In the past 10 years, the price has increased by 200 percent, according to World Bank data. "It takes three tons of fishmeal to raise one ton of fish," says Paul Jones, who scouts for agriculture innovations at Mars, a $35 billion food company that is also the world's largest manufacturer of pet food. "The economics don't make sense long term."

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