KENYA’S MUSHROOM INDUSTRY

BUSINESS INVESTMENT OPPORTUNITIES

Overview of the Study

• Agri-Pro Focus initiated an exploration to identify business opportunities in Kenya’s mushroom industry.

• Objective; To facilitate business linkages across countries.

• By sharing information across countries and to industry actors on market size of potential opportunities,

• And brokering linkages to potential business partners – directly and indirectly.

Methodology Methodology • Interview of key actors in mushroom value chain;

input suppliers, producers, and marketers.

• Focus was on actors that can engage potential partners on a B2B level.

Limitations

• Few B2B level players in the mushroom industry

• Getting information from market actors.

Estimation of the market size was therefore based on information from very limited actors.

Findings: OverviewFindings: Overview

• Kenya has an estimated demand of between 540-1200 tons of mushrooms annually.

• Commercial production started in 1997 with 4 firms; Agridutt, Eldoret Mushrooms, Rift Valley Mushrooms and Olive mushrooms.

• Commercial varieties produced are button and oyster. Others are Shitake, Reishi, Gernoderma and Potabela.

Production and Production and MarketingMarketing

• The industry is still nascent with an estimated 200 with less than 5 large scale growers.

• Large scale producers account for about 60% of production estimated at 500 tons annually.

• Average production capacity is; 8 tons monthly for large scale producers and 20 to 100 Kg for small scale producers.

• Tourists and the upper and middleclass population in Nairobi and Mombasa constitute the largest market.

• But the demand outstrips supply – Kenya imports approximately 150 tons annually.

Limitations in the Limitations in the industryindustry

• Technology; most small holder producers have inadequate skills in mushroom production.

• Production structures; control of the environment in mushroom growing structures is a challenge.

• Spawn; 80% of spawn used in Kenya is imported. Some firms multiply and sell to small holder producers but failure rate is high.

• Substrate; most farmers have challenges developing their own substrate.

• Value addition technologies are limited making marketing of mushrooms a challenge

Business OpportunityBusiness Opportunity

• Production and supply of quality spawn;

• Production and supply of substrate

• Supply of production technologies.

• Supply of Post-harvest handling and processing

technologies

Demand DriversDemand Drivers• Large scale producers’ demand for inputs is

influenced by the market demand.

• Small holder farmers get into mushroom

production as a result of influence from others.

Businesses Businesses PartnershipsPartnerships

Olive Mushrooms Ltd.

•Establishing a modern lab to produce spawn

•Processing mushroom and access to European

markets

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