Denny Mushrooms Farm closure raises fears of supply shortages in South Africa

SOUTH AFRICA – The planned closure of Denny Mushrooms’ Phesantekraal farm in the Western Cape has stirred concern among market agents and producers over mushroom supply and pricing in South Africa.

The facility will cease operations in December 2025, leaving only the company’s Gauteng plant in operation.

The company has not shared reasons for the shutdown or details on how the move will affect national supply volumes. This marks Denny’s second closure in three years after a similar decision in 2022.

Market players fear the exit of Denny Mushrooms will create a supply gap and push prices higher in the short term. William van Niekerk, director of Cape Town market agency Fine Bros, said shortages would likely hit soon after production ends.

“Denny does not discover prices daily on the fresh produce markets based on supply and demand, like other commodities. They decide on a feasible price and keep it constant throughout the year. Because of the competition in the market, most other producers have to follow suit,” he said.

Van Niekerk added that while prices could rise, the change may open opportunities for other producers. “Until the supply gap left by Denny Mushrooms was filled over the long term, any farmer who could increase supply in the meantime stood to benefit,” he said.

High costs and biosecurity challenges

Producers say they are ready to step up production but warn that mushroom farming remains costly and technically demanding. Many farmers are struggling with narrow profit margins due to high input costs and low consumer spending.

Marietjie Kruger, owner of Chanmar’s Humble Mushrooms near Heidelberg in Gauteng, said that weaker household budgets were already affecting sales. “It is a luxury product and many look for cheaper ingredients that can go further,” she said.

Kruger noted that veganism and growing demand for exotic varieties such as shiitake and enoki had boosted sales in recent years, but profitability for button mushroom growers remained under strain. She also highlighted disease control as a serious challenge.

“Pathogens spread like wildfire on a mushroom farm and can wipe you out in a matter of days. It is very difficult to get up and running again after that, and most farmers will exit the industry at this stage,” she said.

Sourcing materials and adapting to change

Kruger pointed to substrate sourcing as another difficulty. The substrate used for growing mushrooms is often imported from wetlands abroad, raising environmental concerns about extraction practices.

She said she had since developed an alternative substrate locally, showing that adaptability was vital for long-term survival in the sector.

“Mushroom farming is highly technical and expensive to set up. The school fees are costly, and farmers considering mushroom farming need to do their homework,” Kruger said.

The industry now faces a delicate balancing act between maintaining supply, managing rising costs, and adapting to changing consumer habits as Denny Mushrooms prepares to scale back operations.

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