Mushroom Waste

Innovation Practice

Every year, 200,000-260,000 tonnes of valuable mushroom waste is produced in Australia. We worked closely with the Australian mushroom industry to find valuable new opportunities for mushroom waste streams.


Tones of valuable mushroom waste


New solutions for mushroom waste streams were recommended


Potential costs savings or revenue from recommended solutions

About the project

The past 15 years have seen extensive change in the Australian mushroom industry resulting in decreased profit margins, increased costs and industry consolidation. Although Australian mushroom producers already participate in the circular economy, the industry is looking to innovate and maximise revenue of their waste streams as one solution to these new pressures. Horticulture Innovation Australia, in conjunction with the Mushroom Strategic Investment Advisory Panel, tasked AI with finding and testing solutions to improve the profitability of mushroom waste. This included assessment of technologies worldwide, full financial models of viability, commercial partnership formation and capability for widespread industry engagement.

The problem

With increased competition from organic and green waste, spent mushroom substrate (SMS) earns approximately 25-50% (grower dependent) less per tonne than 20 years ago. Mushroom producers currently receive close to nothing for their stems even though the stems are a perfectly edible food source and labour is expended in their removal. Mushroom waste is a valuable product, but the economic return of mushroom waste is largely depressed by geographic constraints. Because of the high water concentration of SMS and mushroom stems (70 and 90% respectively), transportation and storage costs hinder the economic viability of mushroom production waste and reduce market opportunities for mushroom growers.

The solution

With mushroom growers, AI explored the current state and the changes required to get to a desired future state. We conducted a global search for current and emerging technologies, processes and companies, then validated potential solutions with mushroom growers. Eight solutions were assessed in terms of desirability, feasibility, viability and scalability from which four solutions were recommended with accompanying business models, financials and commercial-scale field trials. These included waste reduction processes, waste to energy conversion, food waste reduction technologies and creation of high-value food products from waste. $55 million of potential cost savings or revenue-generating opportunities were identified.