Mushroom Growing Business for Uganda: The Real Magic Uncovered

'In just 90 days, I was able to get over Shs. 50 million from the 7,000 stems of oyster mushrooms I grew. Each stem produces an average of 1.5kg of mushrooms in that 90 day period, and a kilo of mushrooms ranges from between Shs. 5000 and Shs. 8000.'

Mr. Kiddu Abel of the African Grower's association (U) Limited

Mr. Kiddu who is referred to above is right, mushrooms do grow quick. Their complete growth cycle is on average 15 weeks (about 4 months), even when using rudimentary methods. In Uganda it is common to grow them by having polythene bags suspended from the ceiling/roofs of dark grass thatched huts. The polythene bags being stuffed with damp cotton seedlings as well as maize brand, cotton or timber waste. With modern methods however, the mushrooms begin to sprout after 1-3 days.

So with the above in mind, how do you set about to make money to "feed the gods" of Kampala and it's surrounding areas?

FIRST THE CONS

1. Small Market.

Whilst mushrooms are technically not vegetables, they are often classified as such and owing to a low-level of disposable income, they are often not considered a necessity by Ugandans and therefore market is often limited to supermarkets and a few markets. The East African and International markets as per a few other research reports I have viewed seem to show that exports from Uganda would not be competitive when compared to other countries. The market will not therefore be significant but I however believe that the demand still outstrips the supply and with an increasing middle class, it is expected that demand for mushrooms will continue to grow.

2. Perish ability

Mushrooms are highly perishable and need to be consumed fast or properly preserved immediately after harvest; either through drying them or freezing. For the more advanced farmer, I recommend that you preserve them by drying them using a tunnel dryer. A tunnel dryer is estimated per Uganda Investment Authority (UIA) to cost $250. At September 2012's exchange rate this is about Shs 632,000. I however expect that to be the non commercial type as the commercial ones are in the range of $6,500 but I believe the non commercial is a good starting point. There is of course a possibility that the creative manufacturers of Katwe near Kampala can make you a local tunnel dryer.

An alternative to drying is to have refrigeration facilities to keep them fresh as some consumers including export markets prefer fresh to dried mushrooms.

3. Water.

Mushrooms need constant supply of water and a moist dimly lit environment to grow favorably. We therefore recommend having an underground water tank to ensure constant supply of water.

4. Edible types.

Identifying and consuming only the edible types is a challenge, poisonous types with harmful toxins can easily be mistaken for edible ones. I would recommend that you contact an experienced grower to help you find the commercial and edible type of mushrooms. The most common types in Uganda being the oyster and the button types.

AND NOW THE PROS

1. Little Space.

Growing mushrooms doesn't need a lot of land or space. It is particularly suited for even a Kampala suburb dweller and mushrooms can be grown in your backyard or store.

2. Simple process.

Mushroom growing is simple and doesn't require a lot of expertise and intensive care. The art of mushroom growing can be mastered quickly and easily as compared to other agricultural products or plants.

A word of caution, despite the ease of learning, it is worth visiting a farmer in Uganda to get first hand training. You can try Kabale district which owing to its cooler climate is renowned for mushroom growing and even has modern commercial facilities.

3. Profitability and return on investment.

I estimate the Return on Investment for this sector is as follows:

Start up capital (A): Shs.4,420,000

Profitability (B): 19,170,000

Return on Capital (A/B): 0.23 years

Final word

Mushroom growing is easy to learn and with low start-up costs and returns in about 3 months as shown above. This is therefore a cracking venture to start. It is also a sustainable venture as mushrooms are a very good alternative source of protein.

Mushroom growing therefore has the double benefit of being profitable and good for the community (as a healthy living option).

Otherwise best of luck!

For over 8 years I have worked with several clients providing audit, accounts, tax and advisory in sectors ranging from agriculture, mining, entertainment, financial services and technology.

My client portfolio in Uganda, The Bahamas and The Channel Islands, United Kingdom has equally been diverse and this experience has given me a "well rounded" view of business including several clients in this sector.