Mushroom Cultivation Project Report



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Mushrooms are one of India’s most preferred foods due to their exotic taste and the benefits that come with them. His agriculture has grown among entrepreneurs thanks to its nutritional and medicinal benefits and low-cost, high-yield inputs. They are edible, wild, and some of them can even be poisonous. The edible mushroom is a fleshy mushroom (Basidiomycota, Agaricomycetes) with stems, hoods and gills under the hood. It contains more than 90% water and less than 1% fat, is loaded with B vitamins, copper and selenium and is low in sodium. It can be consumed in various forms such as fresh, pickled, dried, powdered, canned, etc.

Mushroom farming is one of the most successful agribusinesses that requires little capital and little space to begin. Mushroom gardening is quickly becoming a viable alternative source of income for many people in India. The United States, China, Italy, and the Netherlands are the leading mushroom growers globally. Uttar Pradesh is the largest mushroom grower in India, followed by Tripura and Kerala. 

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Market Analysis

Global Mushroom Market Analysis, Size, Share, Growth, Trends, and Forecast 2021–2026.

Over the projected 2020-2025, the mushroom market is anticipated to reach $49.7 billion, with a CAGR of 9.7%. Mushrooms and toadstools are edible fungus (Agaricomycetes, Ascomycota) eaten as vegetables but do not plant. Riboflavin, potassium, vitamin D, selenium, and other nutrients found in mushrooms are helpful to human health.

Market Scenario Analysis, Trends, Drivers, and Impact Analysis are the top influencing factors.

With the rising demand for mushrooms, the worldwide mushroom farming industry is expanding. The worldwide mushroom cultivation industry is being driven by increased consumer awareness of health problems and organic goods. Lifestyle changes also contribute to the market’s expansion. However, a shift in mushroom production might stifle market expansion. On the other hand, the development of distribution channels and online platforms may provide a chance to promote worldwide market growth.

The following are the worldwide mushroom farming industry trends:

With the rise in mushroom production, firms are expanding their distribution channels by partnering with other shops and online growers.

Companies are expanding their market share and target markets through mergers, acquisitions, and partnerships.

Also Read: Article on Top 10 Business Ideas in Assam

Steps to Start a Business

Step 1: Choose the Variety for Mushroom Farming

Varying varieties of mushrooms have different production costs, so setting a budget based on the quantity of money available and the long-term investment return is critical. In general, there are three varieties of cultivated mushrooms Button, Oyster, and Paddy Straw Mushroom.

The oyster mushroom is an excellent species to start mushroom gardening with. Shiitake, Lions Mane, White Button, and Portobello are some more lucrative and easy-to-grow types.

Step 2: Environment

Consider the environment for mushroom cultivation while starting a mushroom farming company. Different kinds necessitate various environments. The oyster mushroom, for example, requires a temperature of 15 to 20°C, a humidity of 80 to 90%, excellent ventilation, light, and sanitation, among other things.

Step 3: Get Spawn for Farming

To begin the culture, you must have spawned. You may either use a sterile culture to make your spawn or buy ready-to-inoculate spawn from the vendors. Because the initial cost will be significant in this scenario, producing spawns may be cheaper in the long run.

Step 4: Prepare Substrate

Mushrooms may be grown on a wide variety of agro-waste, including cellulose and lignin, which aids in cellulose enzyme synthesis, which increases output. Paddy, wheat, ragi straw, maise stalks and leaves, millets and cotton leaves, sugarcane bagasse, sawdust, jute and cotton waste, dried grasses, used tea leaf waste, and other materials can be utilised.

Also, use industrial waste such as sludge from paper mills, coffee leftovers, tobacco trash, etc. Steam pasteurisation, hot water treatment, composting fermentation, and chemical sterilisation are the most common substrate preparation procedures.

Step 5: Pack the Bags/ Boxes/ Trays

We are composting the substrate, filling the bags with composted material, spawning, and finally incubation until maturity is all part of the bag-making process.

Step 6: Incubation

Arrange the spawning bags, boxes, and trays on a high platform in a dark cropping room to prevent any natural light from entering the area. Maintain a consistent temperature in the growing space as per the type of mushroom.

Step 7: Fruiting in Mushroom Farming

While different species require varying temperature regimes during fruiting, all require 70-80% high humidity. Depending on the humidity level in the cropping chamber, frequent water spraying is needed.

Step 8: Protection Measures while Storing Mushrooms

Flies’ springtails and mites are suspected of attacking the mushroom. The crop is susceptible to fungal disease and diseases such as yellow blotch, brown spot, and others. According to the assaults, you’ll need to implement some special control measures.

Step 9: Harvesting & Storage

The shape and size of the fruit body can be used to determine the best form for harvesting. Before spores are released, the mushroom should be picked. It is best to pluck all of the mushrooms off a cube at once.

In mushroom processing, there are two forms of storage: long-term and short-term. Freshly picked mushrooms can be kept for up to two weeks at low temperatures (0-5°C). Dried mushrooms with a 2-4 percent moisture content can be kept in sealed pouches for 3-4 months without losing their flavour.

Step 10: Mushroom Farming Business Plan

A detailed business plan is required when starting a small business such as mushroom cultivation. Prepare a thorough budget with a clear strategy and objectives, including what type you want to cultivate and if you wish to sell to domestic or international markets.

For small mushroom growing business plan things required:

  • Required cost to establish a business, and how much does it cost to keep it running?
  • Pricing Strategy for Your Target Customers.
  • Spores and other raw materials procurement.
  • How much profit do you anticipate?
  • What are your plans for selling mushrooms?
Step 11: Costing

Starting a mushroom-producing operation is not expensive. More than 10,000 pounds of mushrooms may be grown in a 300-500 square foot space. The cost of beginning a business is estimated to vary between $2500 to $10,000, depending on the size and productivity of the operation.

LED fluorescent bulbs for warming, mushroom spores, casing soil, manure, polythene bags, wooden shelves, and the initial building expenditures for putting up the rooms are other costs. So, for a few thousand dollars, anyone can start a mushroom growing company.

Step12: Fix the Pricing & Calculate the Profit Margins

The profitability of the firm will be determined by the pricing strategy used. Before deciding on prices, the ideal method is to gather the prices of similar goods offered by current mushroom vendors at the market.

Step 13: Name Your Business and Registration

It’s critical to come up with a memorable and accessible name for your mushroom business. The name should clearly describe the type of items you are marketing to the clients.

If you want to run a hassle-free, legally compliant business, you must register your company. Different company formats are available in each country and state. Choose according to your needs.

Step 14: Permits and Licenses

The need for a licence for mushroom cultivation is determined by the secure location in which the business will be established.

Because mushroom growing falls under food production, a licence from the Food Safety and Standard Authority of India (FSSAI) is required.

Step 15: Where to Sell Mushrooms

It is not recommended to introduce mushroom goods professionally until you have a clear concept of where you will sell them. Reach out to restaurants, in addition to wholesalers and retailers, to promote your products.

Restaurants are excellent customers for bulk mushrooms. For companies nowadays, having a website is a requirement. It not only improves your brand but also opens up new sales channels.

Step 16: Marketing Plan

After all, is said and done, it is nearly difficult to create a profitable mushroom farm unless you can advertise and sell the mushroom output. As a result, developing an effective marketing strategy is critical.

In today’s world, any firm must have an internet presence. Create a website as well as a company presence on social media sites such as Facebook. Continue to update your social media accounts with the most recent events and mushroom harvests.

Additionally, sell your mushrooms to local merchants, wholesalers, local restaurants, and grocery stores.

Process Flow Chart

  • Compost Preparation (Synthetic & Natural type)
  • Filling the compost in trays
  • Spawning
  • Casing
  • Cropping
  • Harvesting.

Impact of COVID 19

  • COVID-19 has harmed the global mushroom farming market.
  • Travel restrictions have had a significant impact on mushroom supply across the world due to quarantine.
  • Labour shortage on farms.
  • Due to travel restrictions, the production houses have accumulated a significant stock in their warehouses that they cannot utilise.
  • The only way to get mushrooms is to buy them from an internet retailer.
  • COVID-19 forced the closure of several mushroom farms.
  • Farmers and the economy, both of which are mainly reliant on agriculture, have suffered due to this.

Key Points Cover in Sample Project Report  

Project Report Table of Contents

Sr. No.Particulars
1Purpose Of The Document
2Product And Applications
3Industry Profile And Market Assessment
4Manufacturing Process & Know How
5Process Of Cultivation
6Mushroom Processing
7Flow Chart Of Cultivation
8Land And Building
9Plant & Machinery
11Miscellaneous Assets
12Raw & Packing Materials Required
14Selling Expenses
16Tentative Implementation Schedule
17Sales Revenue: (100% Capacity)
18Cost Of Project
19Means Of Finance
20Quality Control And Standards
21Labelling And Storage
22Basis And Presumptions

Apart from this, all the information is being provided. To help in preparing project reports.


From the above content, it is easily understood that mushroom cultivation drizzles vast profits to the farmers. With the low cost of production, the mushroom can be grown throughout the year except in summers. The mushroom growing industry’s burgeoning demand has opened up a world of opportunities for aspiring entrepreneurs. Mushroom cultivation is being done on a bigger scale across the globe since it is a highly eaten food that continues to be in high demand and suitable for farmers with small landholdings. 


Is mushroom farming a lucrative business in India?

Mushroom growing is becoming India’s most productive and profitable enterprise. It is increasingly gaining popularity in India since it transforms farmers’ hard labour into profit quickly. In India, farmers utilise mushroom farming as a secondary source of income. Expected profit margin in mushroom cultivation, for example:

Button Mushrooms provide a total yield of 10 to 15 kilograms per square foot. The Yield per 250 square foot is around 2,500 kilograms. In the market, the cost of a KG of Button Mushroom is around Rs. 120.The total cost of 2,500 kgs of Button Mushroom at Rs. 120 is now Rs. 3,00,000. Mushroom farming has a total recurring cost of Rs. 1,60,000. Mushroom farming generates a net profit of Rs. 1,40,000 per year. This is all about the profits from mushroom farming in India. You will make big earnings if you maintain effectively.

What is the best way to cultivate mushrooms at home?

Button mushrooms are one of the easiest mushrooms to grow at home, and they can be grown in a plastic bag that can be maintained anywhere. Many mushroom producers utilise straw or wood chips to cultivate their crops. Straws that can be chopped into extremely little bits can be used. If you’re using straws, break them up into little pieces and soak them in water. Boil the straws for around 20 to 25 minutes in boiling water. Remove them from the water and let them cool on a clean surface. Make a two-three-inch layer of straw in a plastic bag and distribute spawn over the top when it has cooled. Assemble the layers in this manner until the bag is nearly complete. Make some holes in the bags and tie them up from the top. You must store this plastic bag in a location where natural light will not interfere with the manufacturing. Please keep it in the darkroom or on a shelf where it will have the right environment.

Remove them from the water and let them cool on a clean surface. Make a two-three-inch layer of straw in a plastic bag and distribute spawn over the top when it has cooled. Assemble the layers in this manner until the bag is nearly complete. Make some holes in the bags and tie them up from the top. You must store this plastic bag in a location where natural light will not interfere with the manufacturing. Please keep it in the darkroom or on a shelf where it will have the right environment. Check your plastic bags in very deem light only. After a few days, remove the plastic bag and let the mushroom usually develop. Please wait until the mushrooms’ caps have uncurled and they are completely developed. Harvest your mushrooms by twisting and picking them off their stalks.

What are the Mushroom Market Challenges?

Limited Shelf Life: The mushrooms are highly fragile due to their small lifetime, ranging from one week to one day. This restricted shelf life of mushrooms is challenging to manage, and it also poses a threat to the mushroom market’s growth. 

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Sample Project Report Format

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