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Mushrooms coming up rosy, but with a slight price wilt this season

Kevin Donovan, national sales manager for Phillips Mushroom Farms, told The Produce News that as the mushroom industry heads into the fall and winter holidays, prices are expected to be higher than last year.

“For all of the typical reasons — supply and demand, increases in production costs, labor shortages and more — prices will increase this season,” said Donovan. “It’s going to be a rosy season, but with a bit of a wilt for these reasons.”

He explained that contracts will, of course, be honored, but they run out at different times and when they do the increase in prices will set in.

philips “In addition to cost increases in production, there is now a mushroom shortage,” he noted. “Because of the many problems the industry has and continues to face, some mushroom producers have shut their doors in the recent past. They simply could not survive. Demand for mushrooms is increasing, and I don’t see it being met by production. That’s not boding well for the outlook on prices going forward.”

He added that in mid-August the company was already seeing signs of increased demand, and the company anticipates price increases of as much as five percent in the future. Foodservice customers, he pointed out, could see between a three- and five-percent increase in mushroom costs.

“The big question now is — knock wood — that production will be good,” said Donovan. “At Phillips Mushroom Farms, production is okay and we’re now planning for increased production from our farms for the holiday season.”

Another near constant challenge is having enough labor to harvest the increases. He said the company hires as many laborers as possible and has a good assessment of its labor situation as the holidays draw closer.

“Harvesters pack into eight-ounce trays directly from picking,” he explained. “Larger mushrooms are also packed directly into trays. But these need more attention and so they take longer. Following this process, we random pick into baskets, typically for slicing.”

The growing medium for mushrooms has also been a thorn in the side of the mushroom industry in recent years. This year, however, it may have a bit of a reprieve. Donovan said the company is looking at new composting materials, such as hay, and things are looking better than last year.

“We are working with it now,” he said. “It’s a completely different product than we used last year. It needs formula changes, so it’s taking a little time to work with it to get it to perfection.

“This new resource is closer to us than where we were previously sourcing it from,” he continued. “Transportation costs to move the medium gets high when it’s shipped from a far distance.”

Phillips Mushroom Farms keeps a firm finger on the pulse of consumer trends, movements and lifestyle changes. For this reason, it continually increases its production of organic mushrooms, which constantly grows in demand.

Donovan said that the company could produce any mushroom it grows conventionally and in an organic option.

Helping to meet the increase in demand in both conventional and organic mushrooms is the company’s new Warwick, MD, facility. This second half of the third expansion of the facility was recently completed — this time adding 80,000 square feet to its footprint.

“This third building is double the size of the first two expansions combined,” said Donovan. “Because of the increase in demand, one of our three buildings now produces only organic mushrooms.”

The entire Maryland facility will produce about 750,000-pounds of mushrooms per week when it is in full production. The company, he added, is already working on plans for the next expansion to the facility.

“We will be adding 40,000- to 60,000-square feet of space to the third building in the upcoming future,” said Donovan.