Shroomwell, an Estonian functional-mushroom company, is planning a production facility worth up to €50M beside the Estonian Cell pulp mill in Kunda.
The proposed mushroom factory would turn wood-processing residues into growing substrate and products for export, Tööstusuudised reports. Saudi Arabian investors have visited the site to examine the project, although no financing commitment or final investment decision has been announced.
Shroomwell and Estonian Cell, a Kunda-based aspen pulp producer owned by Austria’s Heinzel Group, signed a memorandum of intent in September 2025. The companies are studying how aspen bark, sawdust and other by-products from pulp production could be used to make the substrate required for growing mushrooms.
Factory would use Estonian Cell wood residues
The factory is planned for a site immediately adjacent to the Estonian Cell mill. Locating the operations together would give Shroomwell direct access to wood residues and reduce the need to transport bulky raw material before processing.
The project would produce higher-value goods from material generated by the pulp mill. Kunda’s port infrastructure could also be used to export mushroom-growing substrate made at the new facility.
The planned process links two parts of Estonia’s bioeconomy by turning residues from timber and pulp processing into an input for food and wellness production.
Estonian Cell began production in Kunda in 2006 following an initial €153M investment. The mill produces around 170,000 tonnes of aspen pulp annually and exports its entire output to paper manufacturers in Europe and Asia, typically serving about 30 countries a year. Its production uses approximately 450,000 cubic metres of aspen wood annually.
Shroomwell expands its mushroom factory model
Shroomwell already operates a large indoor mushroom-growing facility in Tõrva and a mycological research centre near Tallinn University of Technology. The company grows functional mushrooms and develops wellness products and environmental applications based on fungi.
Founded in 2014 and renamed from Chaga Health to Shroomwell in 2023, the company says it manages around 700 hectares of outdoor mushroom farms in Estonia, Sweden and the US. Its existing production covers the cultivation, processing and sale of functional-mushroom products.
The Kunda plan would move the company into larger-scale production while linking its feedstock directly to an established wood-processing site. The project remains in the planning and feasibility stage, with the final scale and construction timetable dependent on the outcome of the companies’ technical work and investment process.
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