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Oct. 27, 2005

Biotech brings mushroom hunt indoors

SCOTTVILLE, Mich.  Biotechnology often is heralded as the brave new future of Michigan’s industry.

But not often is biotech called tasty – even gourmet.

A burgeoning new company in northwestern Michigan firmly rooted in Michigan State University knowledge is growing exotic specialty mushrooms – including the coveted morels – in a cavernous facility and selling them fresh in grocery stores across the Midwest.

It’s the first mass indoor production of the elusive morel mushrooms – a food usually known in part for the painstaking hunt to harvest them in the forest. Diversified Natural Products Inc. (DNP) is making them available fresh year round.

DNP has used science and entrepreneurism – much of it from MSU – to transform an abandoned bean cannery in the fields of northwestern Michigan into a high-tech biotechnology plant and laboratory. So far, the company has brought 56 jobs to an area battered by business closings.

DNP is selling two tons of mushrooms a week – in five varieties – under the name Midsummer Exotics. It expects to sell 800,000 pounds of fresh mushrooms a year when it reaches full capacity, said Gary Mills, DNP’s chief executive officer.

“We can’t grow enough mushrooms to satisfy the market right now,” Mills said. “It’s a lot of work – a lot of patience and tender loving care – and a lot of science.”

The company has two divisions – bio-based fuels and chemicals, and gourmet and functional foods. The unifying theme is agricultural-based biotechnology that harnesses readily available natural resources.

“We are using non-genetically modified, natural microbes to make useful products – that’s the common thread of this company,” said MSU University Distinguished Professor Kris Berglund, who is DNP’s chief science officer. “The products we’re developing are exciting, they come at the right time on the market and the interest we’re receiving from literally all over the world is tremendous.”

About the mushrooms:

  • They’re not grown in the dark. Instead, the morel, oyster, shitake, cinnamon nameko and black poplar start out in Petri dishes, where the isolated microbes can ferment and grow. Then they’re transplanted to plastic bags containing a mixture of natural biomass. They advance to plastic trays on shelves in cool, moist rooms where they sprout.

  • They have particular tastes. Depending on the species, they’re fed clean, freshly cut oak sawdust and soybean husks. Morels grow in deciduous bark and leaf compost. The special diets are blended and pasteurized to become a fungi buffet. All the resources, and the mushroom strains, are local products. That’s a key part of Diversified Natural Products, Berglund said.

  • The history dates back to MSU. Mills was an assistant visiting professor at MSU in the 1980s. He left to work on mushroom production in private industry, then returned to MSU in 1998. Much of the groundwork was done on campus.

  • Mushroom farming is not for the faint of heart. It’s been an elusive industry for most – especially for the morels. Mills and Berglund note there isn’t much room for the casual cottage industry of mushrooming. The strains must be carefully isolated and screened. Since mushrooms are only briefly in season in the wild, it takes particular strains that can withstand the rigors of quick propagation. Conditions – humidity, temperature, light, nutrients – must be precise. “You have to learn to think like a mushroom,” Berglund said. ”That’s what Gary’s done.”

Currently, Midsummer Exotics are being sold in Meijer stores, through a Grand Rapids-based grocer and in some Whole Foods stores through a Chicago-based distributor.

DNP’s bio-based fuels and chemicals division produces succinic acid from “green” sources. There is enormous global demand for succinic acid for use in everything from industrial solvents and biodegradable polymers to airport runway de-icers. Succinic acid is made from natural sugars, derived from sources such as Michigan corn.

In August, DNP announced a joint venture with Agro Industrie Recherches et Dévelopements (ARD) of Pomacle, France, to produce succinic acid.

The French joint venture is the latest signal of the Michigan company’s momentum. Assisted by brownfield credits from the state of Michigan, DNP has invested $11 million in the Scottville site, which is about eight miles east of Ludington. Berglund said that although the value of the new joint venture is proprietary, the international market for succinic acid, which currently derives overwhelmingly from petroleum production, is in the billions of dollars.

Fifteen of DNP’s patents have sprung from Berglund’s research.