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Mushrooms are a delectable and nutritious food. They are rich in B vitamins and minerals like potassium, selenium and copper. Additionally, they are a good source of protein and fiber, and have anti-aging properties. In many cuisines, mushrooms are valued for their umami flavor, meaty texture and nutritional benefits.
If you want to learn how to start a mushroom farming business in India, then you’re on the right blog post! Read this post till the end to learn about the major mushroom farming licenses and registration requirements for this business.
Starting a mushroom farming business is a good business idea for a variety of reasons. Mushrooms are high in demand because they are regarded as a nutritious food. Additionally, their taste is loved by many. They uplift the flavours of many simple dishes.
They have a short cultivation cycle, allowing quick returns. They are also good for the environment due to waste utilization. Some mushrooms even offer medicinal benefits. Also, mushrooms are often sold at higher rates compared to vegetables, especially the rare mushrooms.
Below, we have mentioned some of the most commonly farmed mushrooms in India :-
Button Mushroom
Oyster Mushroom
Enoki Mushroom
Lion’s Mane Mushroom
Portobello and Cremini Mushrooms
Paddy Straw Mushroom
Shiitake Mushroom
Milky Mushroom
Below, we have explained the necessary steps you need to fulfill to start a mushroom business in India. We’ve also explained the major licenses and registration requirements. :-
First and foremost, you need to decide on the mushroom variety you want to grow. Each and every mushroom variety has different growth requirements regarding substrate composition, temperature, humidity and light exposure. For instance, to grow oyster mushrooms, you can use a variety of substrates like straw, coffee grounds and cardboard.
They require indirect light, high humidity around 80-90% and moderate temperatures around 15-30°C or 55-85°F. They can grow more easily and faster than other mushroom species. In the case of white button mushrooms, a manure-based substrate is required for growth.
Additionally, they require a layer of peat moss, or similar material, to stimulate development. During spawn run, they require darkness or very low light, 85-90% humidity and 22-27°C or 72-81°F temperature.
The Mushroom farm’s location must be chosen carefully. The larger the area, the more mushrooms you can grow. For a large area at a reasonable price, you can pick a location that is in the outskirts of a city or in a village. Make sure to choose a location that offers easy transportation. You must also consider your budget. If you do not have enough budget to purchase a farm, you can start a mushroom business from home.
Since mushrooms generally require a dark area or a low light area to grow, you must cover your mushroom farm with a heavy duty plastic sheeting or make a tent with a blackout material. You will also need to hire mushroom farmers who have the required experience and expertise in growing the mushrooms.
It’s not necessary to register your mushroom business. But we still recommend it. You can register your business as a pvt ltd co, one person company, public ltd company or limited liability partnership. Registration will make your business more credible. If you want to secure a business loan from a bank, it is recommended to register your business as a pvt ltd co or public ltd co.
These two structures are subject to structured governance, higher transparency and stricter compliance requirements. As a result, most banks give preference to them. Additionally, you will also get limited liability protection. In case of an unregistered business such as a sole proprietorship or partnership firm, your personal assets will be at risk in case of business losses or debts.
In India, any business that deals with mushrooms meant for human consumption is required to obtain FSSAI authorization. This authorization is granted by Food Safety and Standards Authority of India. The specific type of authorization depends on the business annual turnover and scale of its operations. FSSAI authorization comes in three different types, i.e., FSSAI basic registration, FSSAI state license and FSSAI central license.
If a mushroom business is small-scale, home-based and operates locally within a district, with an annual turnover of up to Rs. 12 lakh, it requires FSSAI Basic Registration. If it is a medium-sized business operating within one state and has an annual turnover above Rs. 12 lakh and up to Rs. 20 crore, an FSSAI State License is required.
A large-scale mushroom business with an annual turnover exceeding Rs. 20 crore requires an FSSAI Central License. It is important to note that, for a mushroom export business, an FSSAI Central License is required regardless of annual turnover.
Import Export Code is a 10-digit code issued by the Directorate General of Foreign Trade. Any business that is engaged in export or import activities must possess this code, unless specifically exempted. So, if you want to run a mushroom export business, it is mandatory to secure this code. To secure IEC, you need to visit the official portal of DGFT and complete the registration process there.
IEC comes with lifetime validity and does not require renewal. However, to maintain the active status of this code, the businesses’ core details must be updated/confirmed annually on the DFGT portal.
Mushrooms are “scheduled products” under APEDA Act, 1985. Therefore, in order to export them from India to other countries, APEDA registration must be secured from the Agricultural and Processed Food Products Export Development Authority as a mandatory requirement. The registration process needs to be completed online via the official DGFT portal.
APEDA registration doesn’t come with lifetime validity. It only remains valid for a period of 5 years from the date of issue. Renewal in a timely manner is required to ensure compliance with the APEDA regulations and operate a smooth uninterrupted business.
After starting production, you need to find reliable buyers for your produce. You can sell mushrooms directly to consumers in local markets or supply them in bulk to vendors, wholesalers, restaurants and retailers.
In order to build a steady customer base, a strong marketing and sales strategy is essential for your business. By using social media platforms, you can create a local brand and reach buyers more easily as compared to solely promoting your brand offline.
To stand out in the market, it is necessary that you focus on high quality/premium packaging as well as fresh produce and consistent supply. During your business’ initial phase, you can offer introductory discounts or promotional schemes like “buy one, get one free”. Doing so can help you to attract more and more buyers and increase sales.
Starting a mushroom farm business can be quite profitable. This is because mushrooms are sold at relatively higher prices than vegetables, and grow within a few weeks. They’re rich in nutrients and are delicious, making them a favorite food for many people. To start a mushroom business successfully, you need to ensure legal and regulatory compliance by securing the necessary licenses and registrations like FSSAI license, business registration, APEDA registration, import export code registration, etc. In addition to this, you must secure other documents depending on the area where your business is located.
If you need help in registering a mushroom business in India, you can connect with our consultants at Registrationwala. We will help you secure the necessary licenses/registrations!
I’m Manish Kumar, a content management specialist. I simplify complex financial and regulatory topics into clear, insightful content. As a regular contributor to the Registrationwala portal, I provide updates on finance, Tax, government schemes, compliance, and other incorporation information. My goal is to keep you informed about key industry developments and their impact.
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