World Grain - February 2011 - 78

RICE NEWS ROUNDUP

NutraCea enters into purchase agreement with AF Bran
SCOTTSDALE, ARIZONA, U.S. — NutraCea announced that on Dec. 29 it entered into a purchase agreement with Nutra SA, LLC, NutraCea’s wholly owned subsidiary, Industria Riograndese De Oleos Vegetais Ltda. (Irgovel), Nutra SA’s wholly owned subsidiary, and AF Bran Holdings-NL LLC and AF Bran Holdings LLC. Pursuant to the agreement, AF Bran Holdings agreed to purchase membership units of Nutra SA directly from NutraCea for $4 million and to invest an additional $3.725 million in Nutra SA to fund expansion and provide working capital at Irgovel, which operates a Pelotas, Brazil-based rice bran oil production facility. After the initial closing, NutraCea will own a 64.4% interest in Nutra SA and AF Bran Holdings will own the remaining 35.6% interest. In addition, AF Bran Holdings may be required to purchase from Nutra SA or NutraCea, upon the occurrence of certain events, or it may elect to purchase from NutraCea, up to a 49% ownership interest in Nutra SA by December 2012. W. John Short, chairman and chief executive ofﬁcer of NutraCea, said, “We are extremely pleased to have entered into this partnership with AF Bran Holdings. I want to personally thank all of those involved at both AF Bran Holdings and at NutraCea for working diligently through the holidays to ﬁnalize these agreements. “The proceeds that NutraCea receives from this transaction will be used to make distributions to creditors for allowed claims in accordance with the terms of our amended plan of reorganization and to fund operating needs as we continue the restructuring of our global business interests. Funds directed to Irgovel will be used to expand raw rice bran processing capacity from 70,000 tonnes per year to in excess of 85,000 tonnes per year, and to add new technologies to create value-added derivative products from rice bran oil and defatted rice bran. We expect the expansion and new technology projects to take about 18 months to come fully on line and to produce an increase in Irgovel’s EBITDA by more than 300% within 36 months.” The transactions are subject to closing conditions which must be satisﬁed in order for the transaction to be consummated.

Riviana building ready-to-serve rice plant in Memphis
HOUSTON, TEXAS, U.S. — Riviana Foods Inc. announced Dec. 8 that it is building a new facility in Memphis, Tennessee, U.S., that will produce ready-to-serve, microwavable rice products under the Minute Rice brand. The ready-to-serve rice plant will be integrated into Riviana’s 400,000-square-foot processing and packaging plant in Memphis, Tennessee, U.S., which began operation in the ﬁrst quarter of this year. Riviana is in the process of consolidating operations from its Houston and former Memphis plants to the new facility. That transition is expected to be completed by the end of the ﬁrst quarter of 2011. Commercial production at the ready-to-serve plant is expected to begin in mid-2011. Riviana said the building that will house the ready-to-serve production may accommodate a four-fold increase in capacity. Bastiaan de Zeeuw, president and chief executive ofﬁcer of Riviana, said the expansion is in response to double-digit growth in sales of Minute Ready-to-Serve rice products in every year since their launch in 2006. “Since its introduction, we have sourced this range of product through our parent company, Ebro Foods, S.A., in Spain while we evaluated market response,” de Zeeuw said. “This investment will result in substantial savings in both freight and import duties.” Minute Ready-to-Serve rice is available in seven different varieties and additional line extensions are planned.

Thailand looking to export up to 9.5 million tonnes of rice in 2011
BANGKOK, THAILAND — The Thai government has set a target to export up to 9.5 million tonnes of rice, worth $5.6 million, this year, maintaining Thailand’s status as the world’s largest rice exporter. Thai Commerce Minister Pornthiva Nakasai acknowledged that Thailand is likely to export that amount thanks to stronger purchasing power of rice importing countries worldwide, internationally recognized high quality of Thai rice, and effective marketing campaigns in both major and emerging markets. The Thai commerce minister said she expects world rice prices to increase by some 5% this year from last year’s levels, and that parboiled rice will account for half of all Thai rice exports, up from 40% a year ago, as it is increasingly popular in overseas markets, particularly in Africa. According to ofﬁcial statistics, Thailand exported 9.03 million tonnes of rice, worth $5.3 billion, last year, exceeding the government’s target of 8.5 to 9 million tonnes and higher than the export volume of 8.59 million tonnes in 2009.

Vietnam’s 2010 rice exports set record highs in volume, value
HANOI, VIETNAM — Vietnam’s rice exports set a dual record for 2010 in terms of both volume and value. The Ministry of Agriculture and Rural Developments statistics showed that the country exported 6.88 million tonnes of rice, worth $3.23 billion, in 2010, up 15.4% and 21.2% in value over 2009. Vietnam’s traditional rice importers remained the Philippines, Malaysia and Indonesia. In 2010, Indonesia became Vietnam’s third biggest rice importer, as imports from Vietnam rose 24 times in volume and 30-fold in value against 2009. The rice market in 2011 is predicted to be animated and auspicious. Along with the world’s increasing demand, bad weather in numerous countries has caused a drop in food production, and this will drive up the rice export price. According to the Singapore-based Duxton fund management company’s forecast, the world rice price could triple the current one in the next 18 months.

February 2011 / World Grain / www.World-Grain.com

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World Grain - February 2011

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