My San Pedro cacti grow almost a month from seed under fluorescent light (lit approx. 17 hours a day). The substrate is a mix of perlite, gravel and soil.

At first, the perlite particles turned green and now the entire surface is covered by this.

Is this some kind of algae? Should I move the cacti in a clean substrate?

So far I removed the plastic cap that kept cacti germinating in humid environment, the humidity has been gradually reduced by poking small holes in the cap.

From 25 seeds, only 4 have germinated (marked by yellow circles):

Yes it's algae. Your cactus babies look fine but the sogginess of your substrate may have a lot to do with how much algae you've also succeeded in growing!

To remedy this problem you can scrape the soil surface around the seedling to help lossen the soil and Use a bit of cinnamon sprinkled on the surface to get rid of algae then lower your humidity and offer more FAE.

Thanks. The algae formed because of high humidity - now the grow box has been removed from the "incubator" and the cacti are adapting for dry environment.

The algae seems to recede but I will do the sraping anyway. Some black spot, looking like a mold, has formed in one part. I will try to remove it. Hope it won't hurt the seedlings...

Thats why I usually leave my substrate out in the sun or in the oven before using it.
Also algae usually comes from outside so if you make sure the subtrate is clean and close it it shouldnt grow. Use tap water instead of rain water or boil the rain water.

Usually its okay to have a small amount of algae (depening which one) but its better to move them into new soil.

That's exactly what I did. Substrate sterilized in oven, filtered tap water.

I even got a new sprinkler as the old one may have algae in it.

Unfortunately, the "intruction manual" does not always work. Next time I will go with my feeling rather than taking the advice of keeping the seedlings in extremely humid environment (closed plastic box) for too long.

Now the problem is how to "repot" the seedlings without disturbing their roots and not moving too much algae with them at the same time.

Just dig them out with the soil around them and plant them into new substrate with the algae below the surface so it doesnt get light. Also try to make as much substrate fall off without pulling on it.

From my experience the cacti usually grab hold of the substrate good enough so they can support the weight of the substrated they are grown into when you take them by the cactus body with some small pincers or tweezers.