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Business Plan with Financial Information Essay

Shiitake Mushroom Production

More and more consumers have found the distinctive flavor of the Japanese forest mushroom or shiitake appealing to their tastes.  Besides, this forest mushroom has known medicinal properties for lowering harmful cholesterol as well as preventing viral infection, among others.  This mushroom is rated high as condiment in Japan, as well as in China.  Cooked shiitake gives a special aromatic flavor with chewy texture.

Shiitake contains protein, vitamins, and minerals.  Its adenine derivatives have been recognized by health researchers as containing hypocholesterolemic activity.  Its chemical compound ergosterol, upon exposing to ultraviolet light or sunlight, produces Vitamin D1.  One gram of the stuff is enough providing 400 International Units of one’s minimum Vitamin D daily need.

For this plan, shiitake will be grown on wood as substrate.  Some wood species could be used such as Oak tree species or the Quercus species, which is a popular substrate in Japan and China.  Two species, Quercus serrata and Quercus accutissima could be used as log substrates.

Not only in Japan and in China, shiitake cultivation has also spread to other Asian countries like the Philippines where suitable log substrates thrive.  In the US, oriental ethnic food and health stores sell this mushroom.  Shiitake is easy to grow and because of this, mushroom growers in the US have considered shiitake as an alternative crop (OSU). Researchers showed that alternative log substrates aside from the genus Quercus, could be used for the pure culture of Cortinellus shiitake from Japan.  Other logs species suitable for shiitake culture include Lithocarpus jordanae Redh, Q. serrata, Q. acutissima, and Toona calantas.  The existence of the above-mentioned log species suitable for shiitake culture indicates the possibility of having a promising livelihood project for new entrepreneurs.

Growing the Fungus

Shiitake production includes the following steps: 1. Preparing the inoculum; 2. Producing spawn; 3. Preparation and inoculation of the substrate logs; and, 4. Harvesting, drying, and packing.

Pure culture of L. edodes fungus is prepared by isolating the fungus and growing it in a suitable culture medium.  For this purpose, malt extract agar (MEA) or the potato dextrose agar (PDA) is used as the medium for growing the pure culture of shiitake.  These culture media are available from laboratory suppliers.

If commercial PDA is not available, prepare this by peeling 200 grams potato.  Also, prepare 20 grams dextrose, 15 grams agar, and 1 liter distilled water.  Boil the peeled potatoes in one liter of distilled water until soft.  Strain the decoction with cheesecloth and adjust the amount of water to make it one liter.  Add the agar and dextrose.  Heat until the three ingredients completely dissolved.  Pour this culture medium into test tubes, then sterilize in an autoclave or pressure cooker at 121?C psi for 15 minutes.

Isolation of Shiitake Pure Culture

Use the tissue culture technique in isolating and growing of shiitake mushroom in pure culture.  This is done in highly aseptic condition.  To ensure that no contamination will occur, an isolation chamber must be used.  For tissue culture isolation, the following materials are needed: sterilized Petri dishes, alcohol lamp, solid and sterilized agar medium in test tubes, razor blade or scalpel, flat transfer needle or forceps, any commercial detergent or disinfectant solution, alcohol lamp, and sterile distilled water.  Follow the tissue culture technique.  Melt the solid agar (in test tubes) and then pour aseptically into sterile Petri dishes.  Let the agar becomes solid evenly on the Petri dishes.

Obtain a mature shiitake mushroom (fruiting body) that has the margin of pileus (mushroom cap or umbrella) not yet fully extended, or the margin is still pointing inward the stipe (mushroom stem).  From the undersurface of the pileus, cut several pieces of about three-square mm each and then transfer these into a Petri dish with detergent solution for 3 minutes.  Using a flat sterile transfer needle or forceps sterilized by passing thru the flame of alcohol lamp, dip the tissue in sterile distilled water to wash out the detergent.  Dry the tissues for 2 minutes in sterile filter paper in a Petri dish. Then plant four tissues with equal distances on the surface of solid agar in Petri dishes.  Now, incubate at 25 to 28?C for 3 to 4 days until thread-like structures grow radiating from each planted tissue.

Substrates for Shiitake Spawn

Oak sawdust will be used as the substrate for making spawns.  The substrate needs to have 65% moisture content (MC).  This is attained by pouring 65 liters of water to 100 kg oak sawdust.  The moistened sawdust is then mixed or blended completely and placed in bottles or in heat-resistant plastic bags.  Plug the bottle with cotton then cover it with wax paper.  Sterilize bottles in pressure cooker as described above.  After cooling, transfer 5-mm disc of shiitake pure culture from the PDA culture medium.  Incubate the inoculated bottled substrate in a dark room at 19 to 30?C for 4 months.  Uncontaminated spawn bottles could also be used as source of inoculum for another spawn bottles as long as inoculation is done aseptically

Shiitake growers, however, may opt to buy if spawns are available commercially.  Some spawn producers do sell directly to growers at cost.  In Florida, USA, shiitake spawns are available as sawdust type or dowel type

Preparing the Bed Logs for Inoculation

Shiitake fungus prefers Oak logs as the medium to grow, however, recent finds have indicated that other tropical trees such as alnus (Alnus maritima), eucalyptus (Eucalyptus camaldulensis), and  kalantas (Toona calantas) could also serve as good log substrate for shiitake growing.  For tropical cultivation, some of the preparations that would be encountered include the selection, felling, and cutting of logs, and finally harvesting, drying, and packaging of the produce.

It is advisable to cut logs during the drier part of the season.  Only live branches should be used for shiitake cultivation since dead and dry logs or branches have already gathered some other types of fungi on them.  Besides, dead logs may have been infected with decay-causing organisms.  Optimum log size is about 10 to 15 cm in diameter with one meter in length.  Logs are dried a week or two before holing and inoculation of spawns.  After drying, holes of 1 cm in diameter are drilled with a depth of 2.5 cm.  Inoculation of logs with active spawn follows.

Shortly after inoculation, bed logs are piled or laid on a bed-shaped way in crosswise position on top of each log.  Burlap or straw mats are placed on top of the bed logs to protect the logs from excess moisture while allowing just enough ventilation and moisture during wet days.  Logs are uncovered after 4 months and then stacked in rows slanted in well-drained soil possibly under tree canopy or other shades.  Optimum temperatures at the stacking ground are from 15 to 28?C with relative humidity (RH) of 60 to 85 %.

To have good water distribution in the logs, the sides of logs are reversed every 2 to 4 months.  Reversing the log ends also encourages even fungal growth holed in bed logs.  A minimum amount of moisture about 40% should be retained in the logs for fruiting body initiation.  Use overhead sprinkler to increase the log’s water content.  Commercial producers of shiitake subject the logs to dehydration then followed by water soaking at cool temperature.  This practice results to having vigorous production of fruiting bodies within a week after water soaking.  This practice, however, is complemented with good ventilation and shading from light to effect new fruit initiation.

It is important, though, to protect the log’s bark from damages such as scraping and tearing.  Checking out for possible occurrence of pests, like ants and termites, should be done since these insects carry undesirable contaminant fungi.  If contamination occurs, logs should be removed at once.  Use the contaminated logs as fuelwood.

Harvesting, Drying and Packaging

Shiitake matures some 3 to 8 days from the time it emerges from the bed logs.  The fruits are picked daily just before the cap completely expands or when the cap’s margin still curving inward.  Care must be maintained when harvesting since damaged mushrooms offer less value in the market.  Sun drying is a common practice for shiitake.  Alternatively, the fungus is dried on the rack at 35?C for one hour followed by 60?C for 2 hours until completely dried.  Such dried shiitake could be stored for more than a year without losing the distinctive flavor and aroma.  Dried shiitake are sorted, packed, and sealed in high-grade plastic bags or other convenient containers for storage.

For tropical shiitake production, the cost of production will include labor, supplies, and materials.  If a grower uses 1,000 logs in shiitake growing, his labor costs will include the cost of log collection, the cost of transportation or hauling from forest site to the log beds area, the costs of preparing logs, the costs of drilling or punching holes on logs, and the costs of maintenance (watering, etc), including the costs of harvesting.

For the supplies and materials, some costs would include fuel and motor oil for chainsaw, the costs of fuel and motor oil for drilling, chainsaw, and drilling rentals, and the costs of 150 bottled spawns.  Adding up all gives the total costs of production.

For returns, tropical production gives an average yield of .8 kg per log per year.  For the second and third year of operation, yield increases to 1 kg or over per log per year.  From this point of view, one can determine the net return or profitability of growing the log mushroom.

Shiitake growing and its profitability under the US condition

Under the US condition where shiitake cultivation is possible, several growing areas have sprouted for the American gourmet where the mushroom could be used as meat substitute for vegetarian dishes.  Small-scale raisers can easily sell shiitake to restaurants, resort owners, farmers’ market and to organic retailers (University of Florida).  Some years earlier, the price paid for quality shiitake ranged from $4 to 6 per pound.  The current price of the same product may be a little higher.

In Florida, spawns are purchasable as dowel plugs or sawdust paste or blocks, which should be purchased about 30 days before the actual log inoculation.  If you grow the mushroom in Florida, consider the following start-up costs.  Consider the costs of hardwood logs (available from firewood dealers).  Prices of logs (4 to 5 inches wide with 3 to 4 feet long) vary between $0.50 to $1.00 or more.

Other costs should also be considered such as drill (perhaps $175 to $300); drill bits ($6 to 10); cheese wax or food-grade wax; and spawns (sawdust type, about $600/1,000 logs); aluminum tags; inoculating tools; metal water trough; and, one used refrigerator (perhaps $100).

Production and harvesting labor, fuel, electricity, and packing will fall under variable costs.  Some costs are optional such as membership to grower’s association, and the use of some instructional books and videos.

Let us say that the costs of producing a pound of fresh shiitake mushroom is $3.00 per pound and you have sold it for the wholesale price of $4.50 per pound.  With a cull rate of 20%, shiitake log producer would have a 6.5 % return for his investment for a four-year growing period.


OSU.  Oklahoma Cooperative Extension Service.  (Undated).  Growing Shiitake Mushroom.  From http://www.osuextra.com.  (21 February 2008).

University of Florida.  IFAS Extension.  Shiitake Mushroom Production and Marketing.  (Undated).  From http://taylor.ifas.ufl.edu.  (21 February 2008).

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