How to Start a Mushroom Business in South Africa

Grow and Sell Mushrooms or DIY Mushroom Kits

Mushroom farming is a rapidly growing industry in South Africa, and it offers fantastic opportunities for beginners and seasoned entrepreneurs alike.

Whether you're interested in growing and selling fresh mushrooms or creating DIY mushroom kits for home gardeners, there are many ways to profit from this thriving market.

Mushrooms are also highly sustainable, and starting a mushroom farm doesn’t require a lot of space, making it ideal for urban farming.

Here is everything you need to know if you’re thinking of starting a mushroom business, from how to grow mushrooms and set up your farm, to crafting mushroom-growing kits and finding the best markets to sell your products.

Step 1: Decide the Size and Scale of Your Operation

Before you begin, it’s important to think about how large you want your mushroom farm to be. You can start small in your garage or backyard, or go all-in with a larger, more commercial setup.

Small-Scale (Home-Based Farming)

If you’re just getting started, you can easily grow mushrooms in a small space, like your garage, a spare room, or even a corner of your backyard. The good news is that mushrooms don’t need a lot of light or space to grow.

Pro tip: For beginners, try starting with 5 to 10 grow bags of oyster mushrooms or white button mushrooms. These are easy to grow and will help you understand the growing process without being too overwhelming.

You can buy starter kits or grow bags from Mushrush or Ekasi Mushrooms.

Medium-Scale (Shed or Dedicated Grow Room)

If you’ve already tested the waters and want to expand, consider converting a shed, greenhouse, or a spare room into a dedicated grow space.

At this stage, you’ll need to invest in equipment like humidifiers, fans, and temperature controls to create the perfect growing environment.

Pro tip: Start with 50-100 grow bags. This is manageable for one or two people and will allow you to experiment with multiple mushroom varieties, such as oyster and shiitake. Consider building simple shelving units to maximise vertical space.

Large-Scale (Commercial Production)

For commercial mushroom farming, you’ll need a warehouse or large, climate-controlled space where you can grow hundreds to thousands of pounds of mushrooms per week.

At this level, it’s all about automation and efficiency. You'll need advanced tools like CO2 monitors, industrial humidifiers, and large-scale incubation chambers.

Pro Tip: To scale up, try purchasing bulk equipment from specialised suppliers like Hawkeye Farming Supplies. You can also buy commercial-grade spawn in bulk from Mycelium Organic Mushrooms.

Step 2: Choose the Right Mushroom Varieties

The type of mushrooms you choose to grow will determine the equipment you need, the type of substrate you’ll use, and the markets you can target.

Let’s break down some popular options:

1. White Button Mushrooms (Agaricus bisporus)

Why It’s a Great Choice:

• The most common mushrooms you’ll find in grocery stores
• Widely recognized
• Have a stable market
• Easy to sell to restaurants, grocery stores, or directly to consumers.

How to Grow Them:

White buttons prefer a compost-based substrate, which is a mixture of manure and straw. You’ll need to carefully pasteurise the substrate to avoid contamination. You can buy pre-made white button mushroom spawn from **[Mushrush](https://www.mushrush.co.za/)**.

Pro Tip: Keep the growing area cool and dark (about 12-15°C). White buttons need consistent humidity, so having a humidifier and CO2 monitor is essential for success.

2. Oyster Mushrooms (Pleurotus ostreatus)

Why It’s a Great Choice:

• One of the easiest varieties to grow, especially for beginners.
• Grow quickly and don’t require complex substrates.
• Very popular with chefs and health-conscious consumers.

How to Grow Them:

Oysters can be grown on straw, sawdust, or even coffee grounds.

They thrive in a humid environment with plenty of fresh air. You can grow them in breathable plastic grow bags with small holes for ventilation.

Pro Tip: If you're using coffee grounds as a substrate, ask local coffee shops for free leftovers. Many shops are happy to give them away for free, reducing your costs.

3. Shiitake Mushrooms (Lentinula edodes)

Why It’s a Great Choice:

• Prized for their meaty texture and rich flavour
• Higher price compared to white buttons or oysters, but they take longer to grow.

How to Grow Them:

Shiitake mushrooms prefer hardwood logs or sawdust blocks as their substrate.

They take longer to incubate (several months), but the logs can produce mushrooms for years with proper care.

Pro Tip: Consider buying pre-inoculated shiitake logs from suppliers like Field & Forest Products. This way, you can focus on fruiting rather than the inoculation process.

4. Medicinal and Exotic Mushrooms (Lion’s Mane, Reishi)

Why It’s a Great Choice:

• Medicinal / exotic mushrooms like Lion’s Mane & Reishi are becoming increasingly popular, especially among wellness enthusiasts.
• They’re used in supplements and for their health benefits, such as boosting brain function and immunity.

How to Grow Them:

These mushrooms are a bit more challenging to grow and often require precise environmental controls.

They usually grow best on sawdust or hardwood substrates and need high humidity and low light levels.

Pro Tip: Start small with these varieties and experiment to get the hang of their specific needs. You can buy medicinal mushroom spawn from Mycelium Organic Mushrooms.

Step 3: Preparing the Substrate for Your Mushrooms

The substrate is what mushrooms use for food.

It’s super important to get this step right, as the wrong substrate or poor preparation can lead to contamination, which could destroy your entire crop – which you definitely don’t want.

What Substrate to Use:

• Straw – Best for oyster mushrooms. It’s inexpensive, easy to find, and easy to prepare.
• Sawdust / Wood Chips – Perfect for shiitake, reishi, and lion’s mane mushrooms. You can purchase sterilised sawdust from suppliers or prepare your own using hardwood chips.
• Coffee Grounds – If you're growing mushrooms on a small scale, you can use coffee grounds. They’re free, and many urban farmers use them as a sustainable option.

How to Prepare Your Substrate:

1. Pasteurisation

You’ll need to pasteurise the substrate to kill off any competing bacteria, fungi, or pests.

Straw – Pasteurize straw by soaking it in hot water at 65°C for 60-90 minutes. After that, drain the straw, let it cool, and it’s ready to mix with mushroom spawn.

Pro Tip: If you're working on a small scale, you can use a large pot on your stovetop. For larger setups, invest in a big drum with a propane burner.

Sawdust – Sawdust should be sterilised, not pasteurised. You can do this by steaming the sawdust in a pressure cooker or large metal drum for about 90 minutes.

Pro Tip: Steam sterilisation can be done in a basic home pressure cooker if you’re growing on a small scale. For larger operations, check out suppliers like Hawkeye Farming Supplies for larger sterilisation equipment.

Coffee Grounds – Coffee grounds don’t need much preparation. They come pre-pasteurized, but make sure they’re fresh (not more than a day or two old) to avoid mould growth.

Step 4: Setting Up Your Grow Room

To successfully grow mushrooms, you’ll need a controlled environment. Here’s a breakdown of the main elements you’ll need to consider, and how to manage them properly:

1. Temperature

Most mushrooms prefer temperatures between **15-20°C**, though some, like shiitake, prefer it cooler.

How to Control It

For small setups, a basic space heater or fan can help you regulate the temperature. In larger operations, you might need an HVAC system to maintain consistent conditions.

Pro Tip: Use a thermometer to monitor the temperature regularly. You can find reliable thermometers on Takealot or at Builders Warehouse.

2. Humidity

Mushrooms need high humidity (around 85-95%)

If the air is too dry, mushrooms won’t develop properly. Too much moisture, though, and you risk bacterial infections.

How to Control It:

For small growers, you can use a mist sprayer to mist the grow room a couple of times a day. For larger setups, invest in a humidifier to maintain constant humidity.

Pro tip: You can find affordable humidifiers on Takealot. Make sure to get a hygrometer to measure the humidity levels.

3. Ventilation

Mushrooms breathe, and they produce CO2. If you don’t have enough airflow, they’ll grow long stems and small caps.

How to Control It:

Install a small fan or set up ventilation ducts to circulate fresh air.

Make sure your grow room has proper airflow without creating drafts that could dry out the mushrooms.

4. Lighting

Mushrooms don’t need a lot of light, but they do require some. They prefer low-light conditions, so avoid direct sunlight.

How to Control It:

Use low-wattage LED lights or simple fluorescent lighting to provide just enough light for your mushrooms to grow.

Pro tip: A simple LED strip works perfectly in a grow room and can be purchased from Lumeno.

Step 5: Harvesting and Storing Your Mushrooms

When it’s time to harvest, timing and technique are key to ensuring your mushrooms are of the best quality.

When to Harvest:

• White Buttons – Harvest when the caps are still closed and the veil hasn’t broken.
• Oyster Mushrooms – Wait until the caps flatten out but before they start releasing spores.
• Shiitake Mushrooms – Pick when the caps have fully opened but before the edges start curling up.

How to Harvest:

Use a clean, sharp knife or scissors to gently cut the mushrooms at the base.

Pro tip: Always sterilise your tools before use by wiping them with rubbing alcohol. This prevents contamination and ensures you’re handling mushrooms in a clean environment.

Storing Your Mushrooms:

Refrigerate them as soon as possible at 0-4°C to maintain freshness.

Pro tip: Use paper bags instead of plastic. Plastic traps moisture, which can make mushrooms slimy. Paper allows them to breathe while keeping them dry.

Step 6: Selling Your Mushrooms or DIY Kits

Once you’ve harvested your mushrooms, it’s time to sell!

Where to Sell Fresh Mushrooms:

1. Farmers Markets

A great way to sell directly to consumers and get real-time feedback.

You can use platforms like Market Link to find local farmers markets near you.

2. Restaurants and Cafés

Approach chefs who love using fresh, local ingredients. Oyster and shiitake mushrooms are in high demand in the culinary world.

A cool idea: take a small basket of sample mushrooms to the restaurant. Build relationships with chefs and let them taste the difference between store-bought and fresh, locally-grown mushrooms.

3. Health Food Stores

Many independent stores, such as Wellness Warehouse or Fresh Earth Food Store, are open to selling locally-grown produce, especially organic and specialty mushrooms.

Where to Sell DIY Mushroom Kits:

1. Online Platforms:

You can sell your kits through Etsy,Takealot, or even Facebook Marketplace.

You can also create a website for your business and sell from there.

2. Gardening Stores:

Approach local gardening shops or nurseries.

Kits are often sold alongside other gardening products as a fun, educational activity for families.

Pro Tip: Mushroom kits make great gifts, and you can position them as “eco-friendly, grow-your-own food” products.

How to Make DIY Mushroom Kits:

1. Prepare the Substrate

Use sterilised straw, sawdust, or coffee grounds. Pasteurise it before use.

2. Inoculate

Mix the substrate with mushroom spawn (oyster spawn is easiest for beginners). You can buy spawn from suppliers like Mushrush.

3. Package

Place the substrate in breathable bags or buckets with small holes for ventilation. Make sure to include clear instructions for the customer. Design the packaging to be visually appealing and easy to handle. Simple, eco-friendly packaging can make your product stand out A LOT.

Step 7: Legal and Business Considerations

Registering Your Business

Before you start selling, you’ll need to register your mushroom business. In South Africa, there are nifty online services that are specially made to make it easy to register your business online. Registration ensures you’re operating legally and can help with taxes, licences, and permits.

Forming a Private Company

If you’re selling food products, it’s a good idea to protect yourself legally by forming a Pty Ltd company. This protects your personal assets if something goes wrong with your product, plus there are a lot of other benefits to registering a Pty Ltd company in South Africa.

Health and Safety Regulations

If you're selling to grocery stores or restaurants, you’ll need to follow local health and safety regulations. Check your municipality’s zoning laws to make sure your mushroom farm meets safety standards. You may need regular health inspections if you're selling to retailers or restaurants, so you should visit SALGA for more information.

Let’s Get Growin’

Starting a mushroom business in South Africa is an exciting opportunity with plenty of room for growth.

Whether you decide to sell fresh mushrooms to restaurants and markets or create DIY kits for home gardeners, mushrooms are a sustainable, in-demand product that can be grown in small spaces with minimal resources – all-in-all, a pretty big win in terms of business ideas.

By starting small and learning the ropes, you can scale your mushroom farm at your own pace. With the right setup, equipment, and knowledge, you’ll be on your way to a thriving mushroom business in no time.

Good luck! If you need any assistance along the way as you start, run & grow your business, our Support Team is always more than happy to help!