Mushrooms gain popularity, but prices stay flat

07/27/2012 03:06:00 PM
Tom Burfield

Mushroom grower-shippers are pleased to hear that mushrooms are gaining in popularity among consumers. They’re not so pleased to hear that the price of mushrooms isn’t on the same upward trend as the cost of inputs to produce them.

“All of our input costs have increased like crazy,” said Fred Recchiuti, general manager for Basciani Mushroom Farms, Avondale, Pa.

“Demand for mushrooms has gone way up, but the price has not.”

The prices of inputs like straw and hay have risen because farmers prefer to plant more lucrative corn or soybeans.

At a recent conference at Penn State University, hay prices were said to have peaked last year at $140 per ton compared with $60-70 several years prior earlier, said Gary Schroeder, director of Dole Mushrooms, Kennett Square, Pa.

Currently, the average price is about $120 per ton.

“The average has doubled in a very short time period,” he said.

Mushrooms have become more or less a staple in American diets, Recchiuti said, while the prices have been relatively flat for the past 10 years.

Some growers even have gone out of business.

“That’s usually an indication that the industry isn’t very healthy,” he said.

The industry has faced high-priced inputs for a long time, said Paul Frederic, senior vice president of sales and marketing for To-Jo Mushrooms in Avondale.

However, Frederic said the situation may be improving and that raw materials recently have become more readily available.

“The hay crop has been very good this year,” he said, in part because the region has received a fair amount of rain.

“We’re not losing money,” he said. “We’re making slow, steady progress.”

He attributes some of that progress to the promotional efforts of the Mushroom Council and the fact that consumers are becoming more aware of the nutrition benefits of mushrooms.

“(Mushrooms) are approaching ‘superfood’ status,” he said, thanks to their high amounts of vitamin D, antioxidants and lack of cholesterol.

Mushroom sales during the first six months of the year were strong, said James Sweatt, director of sales for Kitchen Pride Mushroom Farms Inc., Gonzales, Texas.

Several major retailers have taken on more packages of crimini mushrooms, sometimes in large, 16-ounce containers.

“That has tightened the market a lot,” he said.

Sometimes, companies buy excess product from one another, but that hasn’t been happening lately.

“There’s no excess out there now,” he said.

Sales of white mushrooms have been steady, and movement on portabellas has been especially strong for Kitchen Pride, he said.

Business also has been strong for all portabella products at Dole Mushrooms, Schroeder said.

Consumers are opting for the flavor and texture profiles of portabellas over some other categories, he said. Retailers and foodservice operators recognize that consumers can tell the difference.

Memorial Day and the Fourth of July were especially big occasions, as consumers picked up full-size portabellas for grilling and baby portabellas for myriad other uses.

Retailers are running major features on portabellas, not just white mushrooms, Schroeder said.

“I think we’re seeing the growth of that category because of that.”

Even pricey specialty mushrooms have been performing well, said Bob Engel, chef liaison for Gourmet Mushrooms Inc., Sebastopol, Calif.

“Business has been very strong, particularly given the economy,” he said.

That’s an indication that “this is an area of the market where there’s growing interest,” he said.

Recchiuti said part of the reason the industry is in somewhat of a bind is the amount of competition.

The unfortunate truth is, when a couple of additional companies go out of business, if demand remains strong, prices might finally inch upward.

“That’s been the history of the mushroom business,” he said.

The typical cycles last about 10 years, but fuel prices and the costs of raw materials also can have an effect.

In order for business to improve today, grower-shippers would have to be able to raise their prices.

“That’s not in the cards right now,” Recchiuti said.

The good news is that their relatively low prices compared with other vegetables make mushrooms look like a bargain to consumers, Schroeder said, and that may be helping increase demand.



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