Overall impact on ingredients suppliers as yet unclear
International Global rice markets may have plunged into turmoil but at least one leading supplier of functional rice-based ingredients has hoisted up a 'business as usual' sign.
Major rice-producing countries blocked exports as domestic stocks run low — and prices rocket higher. Chicago rice futures hit an all-time high of $22.17/100lb in April — up 63 per cent since January. The crisis hit rice-derived ingredients, too. In New Delhi the price of rice-bran oil, reputed for its cholesterol-lowering properties, has climbed dramatically over the past few months.
But Arizona-based ingredients manufacturer NutraCea, which supplies rice-derived ingredients including rice-bran oil, is keeping its head. Chief operating officer, Leo Gingras, said "Supply is not an issue. We can still get rice bran, just at a higher price. NutraCea is ramping up capacity to meet the rising demand for stabilised rice bran. We do not expect shortages in the near term."
Among NutraCea's plans to maintain supply is an accelerated expansion of the recently acquired Irgovel plant in Pelotas, Brazil. When purchased earlier this year, the plant was operating at less than a third of capacity. By the end of this quarter, the facility should be operating at over 70 per cent of capacity, and close to full capacity in the fourth quarter of this year — ahead of schedule.
But despite NutraCea's success in Brazil, a leading expert has warned it is not easy for companies to station processing plants overseas. "Not all the rice-producing regions are sophisticated or have even the most basic processing capability to produce rice-bran oil," said Kantha Shelke, co-president of Corvus Blue, a Chicago food-research firm. "Setting up a supply chain to make high-quality products and derivatives requires dedicated facilities, which cannot be drummed up in a day."