Executive Summary

This report examines the economic issues surrounding the development of a specialty mushroom based industry in Georgia. A mushroom based industry would not only increase job opportunities in rural areas, but consumption of the product would also improve the diet and health of its citizens. The goal of the study is to make recommendations for creating a statewide network of specialty mushroom researchers, spawn makers, growers, and distributors to stimulate mushroom production.

Nationally, the 1999-2000 value of domestic mushroom sales totaled $867 million, which places mushrooms as the fourth largest vegetable crop in the nation following potatoes, tomatoes, and lettuce. The mushroom industry is a truly international, extremely diverse, and culturally driven market. The National Agricultural Statistics Service mushroom report indicates an increase in sales of approximately 50% during the 1998-1999 season alone. The common button mushroom, which is grown principally in Pennsylvania, currently represents a $351 million dollar commodity, and a $3.5 billion support industry in that state.

Specialty mushrooms differ significantly from common button mushrooms (Agaricus bisporus) in appearance and in the medium in which they are grown. The U.S. imported approximately 1.1 million pounds of non-Agaricus mushrooms per month in 2000. This equates to nearly 50% of all non-Agaricus consumed in the U.S. Almost all (94 percent) were imported from either Canada or China. It is believed that most specialty mushrooms imported from Canada are actually repackaged Chinese mushrooms. While American farmers can compete with the Chinese, it will require adoption of more sophisticated and well-organized practices to raise specialty mushrooms to a commodity crop level. The research and start-up costs of such domestic operations are expensive.

The results of this study indicate that the development of a specialty mushroom industry in Georgia has significant economic potential, particularly in rural Georgia. Due to the broad-based appeal of specialty mushrooms and the steadily increasing demand for them, this crop presents an opportunity to provide Georgia farmers with a product that will be immune from the boom or bust cycle which has characterized American agriculture since the 1950s. Escaping this perpetual dilemma, however, will require a comprehensive public-private partnership that incorporates the research capabilities of The University of Georgia, the legal authority of the Georgia Department of Agriculture, the educational/training capabilities and facilities of post secondary institutions, and the willingness of entrepreneurs to invest in mushroom production facilities.

A variety of demographic and technological trends have occurred that have a potential impact on the continued growth of mushroom consumption in the U.S. and particularly in Georgia. They include: a large and growing population, an expanding minority population, an increase in the number of two working adult families, delayed marriage, and aging baby boomers. In addition, there has been an increased interest in home entertainment and cooking as recreation, as well as more health conscious consumers demanding organic food products. Finally, the ability to market, sell and distribute specialty food items via the Internet is now commonplace.

Further, the positive economic impact of a mushroom industry could be increased if the value added aspects of such an industry were maximized. This includes the use of agricultural by-products from the spent substrate, or mushroom growing medium, development of firms that use mushrooms in products such as meals ready-to-eat (heat and serve), e-commerce, tourism and festivals, and use of mushrooms in the pharmaceutical industry. These endeavors will further assist with the creation of much needed additional job opportunities in rural Georgia. Factors associated with the success of this industry are clearly present in Georgia. They include a large, growing, and diverse population that has familiarity with specialty mushrooms, and available land, water, and other natural resources such as forestry and agricultural by- products necessary for substrate and mushroom production. Georgia's location on the eastern seaboard also means close proximity to other large population centers and potentially lucrative markets due to reduced transportation costs. The cultivation of specialty mushrooms has the potential to produce a commercially successful crop, create jobs, and assist with the process of turning waste products into profitable agriculture for the state of Georgia.

© 2002. Department of Housing and Consumer Economics, College of Family and Consumer Sciences, University of Georgia. All rights reserved.
Contact: Douglas C. Bachtel, Professor. Website by Carole Wheeler - Shabba Classic.