Agricultural biomass hydrolysate is detoxified by culturing in the presence of the fungus Coniochaeta ligniaria (teleomorph) or its Lecythophora (anamorph) state. This organism is capable of significantly depleting the toxicant levels of furans, particularly furfural and 5-hydroxymethylfurfural. A new strain of the fungus has been isolated and deposited in the Agricultural Research Culture Collection (NRRL) in Peoria, Ill., as Accession No. NRRL 30616. The detoxified agricultural biomass hydrolysate is useful as a substrate for industrial fermentation processes, especially in saccharification treatments for bioethanol production.