Nutracea signs Southeast Asian joint venture

The company plans to continue the strategy it has been applying to other regions, entering both the commercial food ingredient market as well as developing humanitarian aid programs. The targets countries in this venture have an annual rice bran production that exceeds nine million tons - more than ten times that of the US and EU production combined - which the company says will provide it will a major business opportunity. "As we advance our mutual business interest in this region, the construction of future plants will be funded from capital sourced directly through the joint venture or project specific financing."​ said Nutracea CEO Leo Gingras. The company at first intended its ricebran technology to be used for nutrition in humanitarian causes. However, in the past year this has been expanding and the manufacturer intends to use its ingredient's growth potential in the mainstream functional food industry to support its humanitarian aims of bringing a cost efficient ingredient to the developing world. Under the terms of the new agreement, Nutracea and its new partner will each contribute $5 million to a limited liability company and will share in the profits from sales produced. NutraCea will also receive a $5mn licensing fee over five year for use of its proprietary stabilization technology. The joint venture opens up new markets for Nutracea, including Indonesia, Thailand, Vietnam, Malaysia, Singapore, Australia and New Zealand. P.T. Panganmas Inti Persada will blend stabilized rice bran into wheat flour and apply the product to finished food goods. Construction of the first facilities is scheduled to begin within the next 6 months in Indonesia and Thailand. These are set to be operational within 18 months. The company will maintain the humanitarian underpinning of its business throughout the joint venture. "We are extremely pleased to combine our resources in a manner that creates opportunities to greatly expand the business prospects of both companies and also provide solutions to the ever present and growing problem of malnutrition in Indonesia and surrounding developing countries,"​ said P.T. Panganmas Inti Persada founder Agus Irawan.