Increased rice bran demand prompts further NutraCea expansion

By staff reporter

- Last updated on GMT

Related tags Rice bran Whole grain Nutrition

On the back of increased demand for its stabilized rice bran
product, California-based NutraCea has announced it is to double
capacity at its Dillon, Montana plant, revising its previously
announced decision to increase capacity by 50 percent.

The move comes just over a month after the leading rice bran technology firm entered into a raw rice supply agreement with the Louisiana Rice Mill LLC (LRM) that could see the company's stabilized rice bran capacity tripled.

Stabilized rice bran is a naturally rich source of vitamins, minerals, and antioxidants, yet it is normally discarded during rice processing. RiceX, a wholly owned subsidiary of NutraCea, first developed the proprietary rice bran stabilization process to turn the by-product of rice processing into a valuable source of nutrition and manufacture products mainly for the animal feed market.

Founded in 1998, NutraCea took the process a step further by developing the means to create food and nutrition products for human consumption from the rice bran it sourced from RiceX.

According to NutraCea senior vice president Margie Adelman, demand for rice bran is growing thanks to the example set by large food giants such as General Mills, which are promoting the health benefits of whole grain products.

"They are paving the way in educating the consumer that they need to consume more whole grain products,"​ she said.

And it is this increase in demand that has prompted NutraCea to increase its previously announced capacity expansion.

"After reviewing several pending matters, the company has decided to accelerate its schedule of capacity additions and take advantage of the fact that the Dillon facility was already undergoing an expansion and that incurring the incremental cost to further expand Dillon now made both economic and market sense,"​ said the company's chief executive officer Brad Edson.

"The domestic and foreign markets for our stabilized rice bran products are growing rapidly and we are studying various possibilities to satisfy this demand. Increasing Dillon's capacity by 100% will satisfy some of that need,"​ he added.

NutraCea said the additional capacity expansion, which will be funded from existing financial resources, will not change the project's expected completion date, currently scheduled to occur during the second quarter of this year.

Increased demand for the company's rice bran derivatives comes after NutraCea's merger with RiceX in June 2005.

The company now controls 100 per cent of the human market for rice bran and 50 percent of the combined human and animal markets, which have a total value of $12 million.

Since the merger the company's facility in Dillon has been operating at or close to 100 percent of its capacity - an increase of 400 percent on the nine months leading up to it.

As well as whole food products and food ingredients, Nutracea also develops nutraceuticals aimed at health indications such as arthritis and high cholesterol.

The company holds six patents for the use of rice bran in nutritional foods to help alleviate the symptoms of certain conditions, including hypercholesterolemia, hyperlipidemia and atherosclerosis, as a supportive therapy for diabetes and to help reduce cholesterol.

And there is no likelihood of the growing demand exceeding supply of rice bran, either. Sixty million metric tones of rice bran are thrown out by rice mills around the world each year or used as low-grade animal feed.

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