Expanding Functional Mushroom Market Predicted to Increase at a Compound Annual Growth Rate (CAGR) of 10.3% through 2034

Expanding Functional Mushroom Market Predicted to Increase at a Compound Annual Growth Rate (CAGR) of 10.3% through 2034

Global Functional Mushroom Market Poised for Strong Growth

The functional mushroom market is set to experience significant growth over the next decade, with projections indicating that the market size will nearly double from $33.72 billion in 2025 to $62.18 billion by 2032. This growth is expected to continue through 2034, representing a compound annual growth rate (CAGR) of approximately 5.6% to 9.1%.

In 2024, North America dominated the market with a 43.8% share and USD 10.9 billion in revenue. The region, known for its demand for health-oriented food and beverage products and a robust dietary supplement industry, is expected to remain a key player in the market. Asia-Pacific, on the other hand, remains dominant due to cultural and historical mushroom use.

Key trends driving this growth include personalized nutrition, the rising demand for functional beverages like mushroom coffee, convenience formats, increased consumer focus on ingredient quality, and multi-ingredient supplements. E-commerce sales channels are also growing at around 6.3% CAGR due to wider accessibility and consumer discounts.

Notable companies contributing to the market include Asia Pacific Farm Enterprises Inc., which has expanded its functional mushroom product line, focusing on organic Lion's Mane and Reishi extracts. Concord Farms has introduced a new range of USDA-certified organic functional mushroom capsules, while Half Hill Farm Inc. has developed a novel mushroom coffee blend featuring Chaga and Lion's Mane for cognitive health. Lianfeng has scaled up production of its functional mushroom extracts, particularly Shiitake and Tremella, for the nutraceutical and cosmetic industries.

In India, government support has significantly boosted the functional mushroom market through subsidies and funding. The market is expected to continue growing due to increasing consumer interest in natural health solutions.

Functional mushrooms are used in a variety of applications, including dietary supplements, functional beverages, food fortification, cosmetics and skincare, and pet health products. Reishi holds a 27.3% share in the market in 2024. Hokkaido Reishi Co., Ltd. has patented a new fermentation process to increase polysaccharide content in its Reishi extracts.

Separate from non-psychedelic functional mushrooms, the psychedelic mushroom market—focused on psilocybin-containing mushrooms for therapeutic use—is expected to grow even faster, at a CAGR of 10.6%, reaching an estimated $4.4 billion by 2034 (from $1.6 billion in 2024). This growth is fueled by expanding medicinal acceptance, therapeutic applications (e.g., PTSD and depression treatments), and evolving regulatory frameworks mainly in North America and Asia-Pacific.

In conclusion, the global functional mushroom market (non-psychedelic) is forecast to nearly double over the next decade, driven by consumer demand for cognitive support, immunity enhancements, convenient formats, and clean-label formulations, while the psychedelic mushroom sector is a rapidly emerging sub-market with higher CAGR focused on medical therapeutics.

Sources: 1. MarketsandMarkets 2. Grand View Research

1. The growth in the functional mushroom market is associated with the trend of personalized nutrition and the rising demand for supplements.
2. Some companies, like Asia Pacific Farm Enterprises Inc., are expanding their functional mushroom product line, focusing on organic and multi-ingredient supplements.
3. The dietary supplement industry in North America, known for its demand for health-oriented food and beverage products, is expected to continue playing a significant role in the market.
4. Functional mushrooms are not just used in dietary supplements, but also in functional beverages, food fortification, cosmetics and skincare, and pet health products.
5. The Asia-Pacific region, with its cultural and historical use of mushrooms, is a dominant force in the global functional mushroom market.
6. Concord Farms has introduced a new range of USDA-certified organic functional mushroom capsules, showcasing the industry's focus on ingredient quality.
7. Half Hill Farm Inc. has developed a novel mushroom coffee blend for cognitive health, highlighting the versatility of functional mushroom applications.
8. Lianfeng has scaled up production of its functional mushroom extracts, particularly Shiitake and Tremella, to cater to the nutraceutical and cosmetic industries.
9. In the Indian market, government support has significantly boosted the functional mushroom sector through subsidies and funding.
10. The growing consumer interest in natural health solutions is expected to drive the continue growth of the functional mushroom market in India.
11. Hokkaido Reishi Co., Ltd. has patented a new fermentation process to increase polysaccharide content in its Reishi extracts, indicating advancements in the technology behind functional mushroom production.
12. Beyond non-psychedelic functional mushrooms, the psychedelic mushroom market, focusing on psilocybin-containing mushrooms for therapeutic use, is expected to grow even faster.
13. The expansion of medicinal acceptance, therapeutic applications, and evolving regulatory frameworks in North America and Asia-Pacific are driving the growth of the psychedelic mushroom market.
14. The psychedelic mushroom market is projected to reach an estimated $4.4 billion by 2034, representing a compound annual growth rate (CAGR) of 10.6%.
15. The global functional mushroom market, both non-psychedelic and psychedelic, is influenced by factors such as wealth management, business investments, and the housing market, as it continues to grow and evolve in the next decade.

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