Growing ginseng for fun and profit
February 19, 2014 11:22 AM Subscribe
A family member wants to retire a few years early and try to make some extra money growing ginseng on her property. Good or bad idea? Snowflakes within.
She lives in upstate NY on a sizable chunk of land, with plenty of natural shade. The goal would be to grow "wild-simulation" quality ginseng, which seems to be selling in the several hundreds of dollars per pound to the Asian market due to unsustainable hunting/poaching.
It sounds like you can get seeds relatively cheaply, plant them, and wait six years, or spend a bit more upfront to get rootlets, and harvest roots in 3-4 years. From what I can tell from googling, it looks like an up-front investment of about $1,000 for seeds can yield a couple hundred pounds of dried roots, or nothing at all if things aren't quite right. I also understand that New York requires ginseng sellers to be licensed, so there might be some additional costs tied up in that as well.
This family member is a green thumb who grows beautiful orchids and definitely knows what she's doing in the garden. The only major concerns are bad luck with climate / soil quality, and theft. I'm aware there's a reality show about Appalachian ginseng hunters fighting over wild roots, but the hope is that the combination of secluded private property and relative lack of attention the plants require keeps things far enough below the radar that it doesn't become a problem.
My understanding is that her retirement/pension assets will let her live relatively comfortably, so this would mostly be a hobby that could pay off a bit down the line and help fund a nice vacation or two.
So is this something people can actually do successfully, and therefore worth the risk of a four figure investment disappearing if the yield isn't spectacular? Is the price premium of buying rootlets to shave a few years off worthwhile? Just trying to get a feeling for the risk/reward calculation here so I can provide some good advice.
She lives in upstate NY on a sizable chunk of land, with plenty of natural shade. The goal would be to grow "wild-simulation" quality ginseng, which seems to be selling in the several hundreds of dollars per pound to the Asian market due to unsustainable hunting/poaching.
It sounds like you can get seeds relatively cheaply, plant them, and wait six years, or spend a bit more upfront to get rootlets, and harvest roots in 3-4 years. From what I can tell from googling, it looks like an up-front investment of about $1,000 for seeds can yield a couple hundred pounds of dried roots, or nothing at all if things aren't quite right. I also understand that New York requires ginseng sellers to be licensed, so there might be some additional costs tied up in that as well.
This family member is a green thumb who grows beautiful orchids and definitely knows what she's doing in the garden. The only major concerns are bad luck with climate / soil quality, and theft. I'm aware there's a reality show about Appalachian ginseng hunters fighting over wild roots, but the hope is that the combination of secluded private property and relative lack of attention the plants require keeps things far enough below the radar that it doesn't become a problem.
My understanding is that her retirement/pension assets will let her live relatively comfortably, so this would mostly be a hobby that could pay off a bit down the line and help fund a nice vacation or two.
So is this something people can actually do successfully, and therefore worth the risk of a four figure investment disappearing if the yield isn't spectacular? Is the price premium of buying rootlets to shave a few years off worthwhile? Just trying to get a feeling for the risk/reward calculation here so I can provide some good advice.
Best answer: That's a great article Ruthless Bunny has dug up which clearly outlines monetary risks/rewards.
Money-wise it seems like a better risk to take. I'd do it!
It now just depends if your family member:
- is physically fit enough to do the work (looks like a lot of digging) or willing to hire people
- really has the time to do it
- can follow through with long term plans (4-6 years)
- is the risk taking type
Ask her: what will you miss more, $1000 or the chance that you tried ginseng farming? ($3800 according to the article, accounting for labor and supplies.)
I'd rather be a failed ginseng farmer than $1000 richer, but I'm just that kind of whimsical personality.
posted by St. Peepsburg at 11:41 AM on February 19, 2014 [4 favorites]
Money-wise it seems like a better risk to take. I'd do it!
It now just depends if your family member:
- is physically fit enough to do the work (looks like a lot of digging) or willing to hire people
- really has the time to do it
- can follow through with long term plans (4-6 years)
- is the risk taking type
Ask her: what will you miss more, $1000 or the chance that you tried ginseng farming? ($3800 according to the article, accounting for labor and supplies.)
I'd rather be a failed ginseng farmer than $1000 richer, but I'm just that kind of whimsical personality.
posted by St. Peepsburg at 11:41 AM on February 19, 2014 [4 favorites]
I seriously looked into this when I lived on a suitable property, and it did look like a good investment. I put it off and then regretted not having done it.
My main concern was theft, as it was hard to control access to my property and the area was known for ginseng and ginseng-diggers. Fencing would have been super expensive and physically impossible in many spots.
If NY state really requires licensing (what???) then that could unfortunately provide a public database of properties on which ginseng is being grown. You might want to take a closer look at how easy it is for people to poke around on the property and also look at how the state handles the information about growers.
posted by ceiba at 11:46 AM on February 19, 2014 [2 favorites]
My main concern was theft, as it was hard to control access to my property and the area was known for ginseng and ginseng-diggers. Fencing would have been super expensive and physically impossible in many spots.
If NY state really requires licensing (what???) then that could unfortunately provide a public database of properties on which ginseng is being grown. You might want to take a closer look at how easy it is for people to poke around on the property and also look at how the state handles the information about growers.
posted by ceiba at 11:46 AM on February 19, 2014 [2 favorites]
And if money is a huge deal, $1000 is not a lot. You can try to family-source or crowd-source that one à la indigogo or kickstarter ("you will be refunded in 6 years + 1% of sales for the first 2 years...."). Geez if I knew you better, I'd pitch in.
But keep the location a secret if you (no "Aunt Ida's Ginseng Farm" signage on her property).
posted by St. Peepsburg at 11:51 AM on February 19, 2014
But keep the location a secret if you (no "Aunt Ida's Ginseng Farm" signage on her property).
posted by St. Peepsburg at 11:51 AM on February 19, 2014
As long as she's not staking her retirement on this and it truly is just 'extra' money, then "successful ginseng farm" vs. "loss of 1k" seems like a very high reward to risk ratio to me.
posted by Lutoslawski at 11:53 AM on February 19, 2014 [1 favorite]
posted by Lutoslawski at 11:53 AM on February 19, 2014 [1 favorite]
Oh one more thing, about the seeds vs. rootlets: it depends on how green your family member's thumb is. I am terrible at growing things from seed. As in, I once planted several packets of seeds in good soil and it yielded nothing. So there is risk of losing her entire $1000 investment if none of the seeds germinate. Depending on the cost differential, I would consider rootlets (personally) in order to de-risk my investment.
She could go the middle ground and buy (smaller amount) of rootlets and see how things go, then buy more rootlets or seeds in a few years depending if things take off. She doesn't have to go all or nothing right away, especially if she will be on the property for 10-20 years.
posted by St. Peepsburg at 12:08 PM on February 19, 2014
She could go the middle ground and buy (smaller amount) of rootlets and see how things go, then buy more rootlets or seeds in a few years depending if things take off. She doesn't have to go all or nothing right away, especially if she will be on the property for 10-20 years.
posted by St. Peepsburg at 12:08 PM on February 19, 2014
Best answer: I've never farmed ginseng but as with any investment the more you can diversify your risk, the better. Get half seed and half rootlets. That way you can have two harvests spread out by a few years, if all goes well. And if it one crop fails, you'll still have the other.
posted by danny the boy at 2:04 PM on February 19, 2014 [5 favorites]
posted by danny the boy at 2:04 PM on February 19, 2014 [5 favorites]
Response by poster: Thanks for all of the helpful responses so far! I'll have her look into what the legal requirements are -- cursory googling makes it look like you don't have to deal with the licensing until you actually start selling, but it'd be nice to know what the rules and costs are there in more detail before she starts.
I did think about the public records aspect in terms of theft, but if that becomes relevant then she's probably at a point where she's ready to turn a profit, in which case spending money on some kind of fence and/or security system wouldn't be a problem.
I guess the only other concern I have is what the market for ginseng will look like in six years. It's gone up uP UP! for a while now, but if a lot of people end up trying to do this, the market could be flooded. Economic conditions in the countries where it's in demand could change as well. But yeah, it's not a ton of money as an initial investment, and she loves outdoorsy gardening type stuff anyway, so it's worth a shot.
posted by tonycpsu at 10:52 AM on February 20, 2014
I did think about the public records aspect in terms of theft, but if that becomes relevant then she's probably at a point where she's ready to turn a profit, in which case spending money on some kind of fence and/or security system wouldn't be a problem.
I guess the only other concern I have is what the market for ginseng will look like in six years. It's gone up uP UP! for a while now, but if a lot of people end up trying to do this, the market could be flooded. Economic conditions in the countries where it's in demand could change as well. But yeah, it's not a ton of money as an initial investment, and she loves outdoorsy gardening type stuff anyway, so it's worth a shot.
posted by tonycpsu at 10:52 AM on February 20, 2014
tonycpsu: "I guess the only other concern I have is what the market for ginseng will look like in six years."
It would be my guess that the market will continue to be supply constrained, simply because of how long it takes to grow the stuff. The variables seem to be 1) will there be fewer East Asian people in the world 6 years from now and 2) will they have less money to spend.
I would personally put money on 'no' for both.
posted by danny the boy at 11:23 AM on February 20, 2014 [1 favorite]
It would be my guess that the market will continue to be supply constrained, simply because of how long it takes to grow the stuff. The variables seem to be 1) will there be fewer East Asian people in the world 6 years from now and 2) will they have less money to spend.
I would personally put money on 'no' for both.
posted by danny the boy at 11:23 AM on February 20, 2014 [1 favorite]
This thread is closed to new comments.
So if she can afford the $1,000 to take a flyer on it, it seems as though there's something to it.
posted by Ruthless Bunny at 11:32 AM on February 19, 2014 [4 favorites]