Caterpillar Fungus Prices Soar to New Records
By wchung | 25 Apr, 2025

The price of a kilogram of caterpillar fungus has soared to 210,000 yuan ($31,600), rising 5,000-10,000 yuan ($790-$1,580) ahead of the Lunar New Year, according to China’s National Business Daily. This makes caterpillar fungus the world’s most expensive herbal medicine — as well as the most disgusting.

Caterpillar fungus is called “dong chong xia cao” which means “winter worm summer weed” in Mandarin. It’s a fungus with the scientific name cordyceps sinensis formed after it infects the ghost moth, a variety found only in the Himalayas and neighboring regions. The fungus attacks the larvae and slowly displaces its innards, turning the caterpillar’s body into a sheath while the caterpillar itself struggles to survive by coming to the surface. The fungus sprouts out of the ground by growing through the forehead of the dead caterpillar, creating a repulsive mushroom that is literally half-caterpillar.

The caterpillar fungus has been used in Tibetan medicine since at least the 15th century. The earliest record of Chinese use is found in the 17th century Ben Cao Yei Bao, a compendium of medicines and healing techniques. It prescribes eating the entire mushroom, including the lower, caterpillar portion. What makes the fungus so valuable is its purported ability to cure cancer, fatigue and erectile dysfunction, among many other ills.

No scientific evidence has emerged with respect to its effect on erectile dysfunction, but researchers have isolated pharmacologically active ingredients shown to protect mice from radiation, protect the liver and have an anti-depressant and hypoglycemic effect. A cancer drug called cordycepin has been developed from several varieties of the mushroom and has proven effective in treating several types of cancers.

The caterpillar fungus first attracted attention outside of China in 1993 when members of China’s track team broke several world records and credited the results to a coach who made them eat it daily. But there remains some question as to their claims because the team later withdrew suddenly from several major contests once improved doping tests were introduced.

The caterpillar fungus is generally produced in Tibet and in Qinghai and Sichuan provinces. A kilogram of premium caterpillar fungus from Qinghai costs 212,393 yuan ($33,636), a 5,000 yuan jump over December. Sichuan’s fungus goes for 210,000 yuan ($33,257) a kilogram, 15,000 yuan ($2,375) more than a month ago. The variety from Tibet is also trading at around the same range. As recently as last May it was selling for about $12,000 per kilogram. Before the sudden surge of demand from Asia and the West, it was selling for a fraction of that.

The astronomical prices the stuff fetches has inspired the name “soft gold” among those in the trade. A single bag of caterpillar fungus is worth the price of an apartment in most of China’s cities. While current prices are at their absolute peak, most traders believe prices will drop back down after the Spring Festival holidays.