It’s hard to imagine Malaysia and Southeast Asia without rice, but what is hard to imagine is the amount of waste that is going on when it comes to growing it, especially from the point of view of the average consumer.
Around 3.66 million tons Of rice husks (the outer layer of rice) are left in the field every year, and this figure is expected to increase to 7 million tons per year from 2020 onwards due to agricultural developments that could increase the yield.
Rice husks The account 20% to 33% of the weight of rice, and is usually left to decompose or burn, resulting in further waste. Moreover, the traditional method of drying rice is in itself also wasteful, which we will touch on later.
Not only did Lincoln, Kisum, and Xie know that this was a problem, they wanted to do something about it.
The trio met at University College London, and they started this project in their second year. Both Lincoln and two uniforms are Malaysian, while Kissum is from Hong Kong.
They came together for a competition called HULT Prize, which is an annual international competition for aspiring social entrepreneurs working in partnership with the United Nations.
Their team won in 2018 and it was Awarded US $ 1 million (RM 4.1 million) to do their work to reduce rice waste and ensure fair trade for farmers in the rice growing industry. They were also the first Malaysian and Southeast Asian group to win this award since it began in 2010.
Rice is currently headquartered in the United Kingdom but is doing business in Myanmar and Malaysia, and is looking to physically expand into Malaysia soon.
Now, they had two problems that had to be addressed in growing rice: the farmers who were not being paid fairly, and the crop losses they usually incur.
To ensure fair trade, rice growers will connect them directly to high-value markets at more fair prices. For example, they currently bring artisanal rice from Sabah to Kuala Lumpur and Singapore, and they also sell rice in the UK through their rice brand. Paddy.
As for reducing crop losses, they have introduced agricultural technology for rice drying which uses the by-product of rice crops, AKA husks, as biomass energy to power this machine and dry the rice evenly. Lincoln likens drying rice to their farming technique to “sink” drying.
Problems with the traditional method of drying rice
Rice is usually dried in the sun. This is a manual process that takes a lot of work and usually takes longer. It takes up to 5-6 days, compared to 5-6 hours with a machine, ”the team shared with Vulcan Post.
Compared with this machine, this traditional method of drying rice is also imprecise, resulting in the rice being too dry or moist.
“Rice needs to be treated with a very specific moisture content, around 12% -14% and any deviation from that will lead to breakage, and thus wastage.”
Moreover, there is also the risk of pollution from surrounding areas, weather changes, and animals invading the drying space. Hence, ensuring a more efficient and less exposed environment in drying rice is important to reduce crop losses.
As mentioned earlier, rice husks are used as biomass fuel and operate these dryers by generating heat which is then directed through a fan to a room where the rice can be dried.
The Rice Inc. team By installing a dryer in the beneficiaries’ villages, farmers can access it by bringing wet rice to them after harvest and drying it for a fee.
Presently, they have two sites in Letpadan, Myanmar, with a processing capacity of over 3000 tons per year, and they are looking to bring this agricultural technology to Malaysia soon.
Let’s talk numbers
On average, installing a “wash” rice dryer costs US $ 10,000 per unit. From 10,000 USD, 6,000 USD is used to purchase the device and 4,000 USD is the setup cost.
“Once a dryer is provided, we can increase the farmer’s income by 15% due to the price difference between wet and dry rice,” they explained. One session can dry up to 5 tons of rice, and it will cost a farmer around RM165.
According to the team, 5 tons of dried rice represents an increase in farmers’ average income of RM820, which allows them to earn around RM8204 over RM7384 for this traditionally dried amount. By paying RM165, this means that they are getting 5x returns on the cost.
Farmers can also expect a 15% increase in their selling price due to the increase in the dry rice yield.
Now, farmers don’t get paid on a monthly basis like us, they get paid during April and November which are the two harvest seasons. Hence, they usually hold odd jobs for the rest of the year.
“From our research, we found that most of the rice farmers belong to the B40 group, and they have an average household income of RM2,527 per month as of 2016, according to this Research“They participated.”
However, they make it clear that they are working with artisanal rice growers to start with (jasmine, basmati, sushi, etc.), so the higher retail prices for this rice are already in place which helps them to pay them better wages. Their role is to ensure that most of the final sale price is redirected to farmers rather than going to middlemen and miscellaneous costs.
“How to do that is to help them with marketing and promotion as well as improving logistics and marketing the price of rice that will be decided by the community.”
Their farmers can decide how much they want to earn when working with them, and they will only advise them with an appropriate pricing point for premium rice and how much Malaysians are willing to pay for it.
Business management challenges
Share with Vulcan Post: “When negotiating deals or interviewing, we always need an interpreter, which makes every conversation take twice as long as we cannot communicate in Burmese.”
When the coup happened, they also had to halt operations in Myanmar for a while and adapt by continuing their work in Malaysia.
Moreover, when they were already getting enough momentum in the UK with 100 to 400 tons of orders, many of these retail outlets closed due to COVID-19.
“Similar to the way Fairtrade Coffee has worked with major brands like Starbucks, we’re still currently looking for ‘Starbucks.’
Hence, what the team is trying to achieve now is to capitalize on this demand for Paddi with major retailers and food chains to be able to bring in more. Kampung On their direct trade platform, allowing more farmers to benefit from direct contact with high-value markets.
- You can learn more about Rice Inc. Here.
- You can read more articles related to agricultural technology we wrote Here.
Featured Image Credit: Lincoln and Kisum, co-founders of Rice Inc.