How to Start Mushroom Farming Business in 2021 - Investments, Profits

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How to Start Mushroom farming business in 2021

Overview

Are you looking for a business which involves farming? Which involves farming with low investment prospects? Which involves low investment prospects with higher profit margin and massive sales turnover? Also which requires some small space and comes at lower costs?

Ever heard of mushroom? Yes, they are your way out. No, not just through your stomach but also for making everything mentioned above possible. Your very own Mushroom farming business

The global mushroom market value is expected to reach $50 billion in the next seven years due to the increasing consumption of mushrooms of various kinds for various purposes

The countries like USA, Italy, China and Netherlands are the top producers of high quality and variety of mushrooms.

Moreover, many developing countries like India are taking up initiatives to fuel the small scale industries through mushroom cultivation and farming.

You’ll be amazed to know how a fungi like this one could get you a business as wholesome as this. Here’s how

Market potential and uses

Mushroom is the fleshy, spore-bearing fruiting body of a fungus, typically produced above ground, on soil or on the food source.

These are majorly used for edible consumption because of its negligible sodium and gluten, low fat and low cholesterol content

The market potential for mushroom farming is vast because of its 20 different varieties and theup and rising demand for each of it in different aspects like in food, medicine, traditional healing etc

Moreover the potential of mushroom can be defined and elaborated for on the following basis

On the basis of types of mushrooms

Button
Cremini
Portobello
Oyster
King oyster
Chanterelle
Hedgehogs
Chicken of the wood
Black trumpet
Wood blewit
Morel
Enoki
Shimeji
Shiitake
Maiitake
Reishi
Lion’s mane
Matsutake
Giant puffball

Of these the most cultivated, grown and consumed mushrooms in India are

Oyster : These are grown in mothers plains
Buttons : These are grown in winter
Straw : These are grown in temperatures ranging from 35°C – 45°C

On the basis of it’s form available

Canned mushrooms
Dried mushrooms
Frozen mushrooms
Pickled mushrooms
Powdered mushrooms
Mushroom sauces

On the basis of uses of mushrooms

For its medicinal properties
For its physchoactivse properties
It’s extensive use in cooking of various cuisines, sauces, toppings etc
Used in dyeing wool
Used in certain biological remediation techniques

Process of mushroom farming

Composting
Spawning
Casing
Pinning
Harvesting

License required

The licenses required to run a mushroom farming business are

FSSAI registration and licence
GST registration
Trade license

FSSAI registration and licence
GST registration
Trade license
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Investment required

The investment required to set up a mushroom farming business would be

Content	Amount
Total investment	₹ 100000
Cost of labours	₹ 30000
Depreciation	12% – 18%
Other charges	₹10000

Profits made

The profit made from mushroom farming business is ₹ 100000-₹ 500000.

If, on the basis of 3000 kg being produced and sold @₹100/kg: 300000

Subsidies and loans for mushroom farming

Extended loans by NABARD
20% subsidy by the National horticulture board
The Rashtriya krishi vikas Yojana provides a subsidy of ₹80000

Target consumers

The target consumers for your mushroom farming business are as follows:

Restaurants/cafés : The restaurants make use of mushroom to cater to the organic and vegan eating needs of consumers in multi cuisine dishes like Thai, Chinese, continental etc
Pizza spaces: The pizza spaces like Pizza Hut, dominos etc require mushrooms as dried or frozen to use them as toppings
Pharmaceutical industries: These make use of the extract of mushrooms including glycoproteins, proteoglycans and polysaccharides for adjacent cancer treatments
Aid in psychological disorders: The mushroom chemical psilocybe cubensis is used as a healer to help people suffering from psychological disorders like OCD, anxiety and sleep disorders etc
Retail stores: The retail stores stock up on mushrooms as dried, organically plucked, frozen, in the form of churned sauces, powders etc for meeting the needs of vegan, diet and health conscious consumers
Super markets: The supermarkets stock up not only on the processed forms of mushrooms but also in different varieties which can be used for gardening, cooking ( Italian, Mexican, continental and American cuisines) by the consumers
Farmer’s market: The consumers who have a knack, habit and prefer to eat organically grown mushrooms visit farmer’s market which has freshly picked mushrooms

Area required

The area required to set up a mushroom farming business is 100-500 sq ft

Raw materials required

The raw materials required to run this business are as follows

Straw with paddy fields
Poultry manure
Urea
Sunflower cake
Wheat bran
Gypsum
Casing soil

Machinery required

The machinery required to set up this mushroom farming business is as follows:

Pew-wet heat turner
Compost turner
Pile forming case
Front end loader
Oscillating head filling machine
Spawn dosing machine
Hopper regulator
Bag filling machine

Manpower required

The manpower required for running your mushroom farming business is

3 skilled workers
3 unskilled workers

Moreover, ample training must be provided to these workers in terms of the following:

Equipment usage
Machine handling
Safety precautions

Business model and growth

The business model of a mushroom farming business can be defined using these four variants

Value proposition: The value which a mushroom farming business is likely to get to you is

Low investment, easily available farming raw materials, lower space requirement
Wider target audience and consumer market segments because of innumerable variety and forms of mushrooms used

Target consumers: The target consumers for your mushroom farming business are:

Retail stores
Supermarket stores
Pharmaceutical industries
Restaurants
Cafés
Farmer’s market

Competitor review: The competitors to your mushroom farming business are as follows:

Shakti industries
Indus mushrooms
Mahagro India

Marketing strategy: The marketing strategy that can be implemented by your mushroom farming business is as follows:

Through sample propositions to restaurants and cafés
By advertising about the R&D claims justifying the quality of mushrooms and their cultivation processes
By ensuring bulk and cash discounts etc to retail stores and supermarkets
By putting up stalls in weekly organic farmer’s market etc

Growth

The mushroom farming business has witnessed and has the potential of the following growth prospects:

The global mushroom cultivation is expected to grow at a CAGR of 4.0% between 2020-2025
The market value of the cultivated mushrooms is expected to account for $16.7 billion by the end of 2020
Moreover the increasing health consciousness among consumers and shift to a vegan consumption has increased the demand for mushrooms because of its low calorie and cholesterol nutrients

Profit margin

The mushroom farming business is likely to yield a profit margin of 12%-15%

Suggestions

A mushroom in variety has 20 of those but this business opportunity is one of its kind. So, if you hadn’t made your mind you could now

Firstly, because of the simple farming techniques and processes, minimal land and capital requirement the mushroom farming business is a very cost-efficient business
Secondly, the market for your organically produced mushrooms is vast from being used by households as an intermediary for cooking to being used at pharmaceutical labs for medical reasons
Lastly, the growing applications of mushrooms and the extended efforts of the Indian government you could also capture the global market