It's hard to imagine Malaysia and Southeast Asia without rice, but what is harder to imagine is how much waste is created in cultivation, especially from the point of view of the average consumer.
About 3.66 million tons of rice husks (the outer layer of rice) remain in the field annually, and that number is projected to increase to 7 million tons per year from 2020 as agricultural advances can increase yield.
Rice husks make up 20% to 33% of the weight of rice and are usually decomposed or burned, resulting in more waste. In addition, the traditional way of drying rice on its own is also wasteful, which we will get into later.
Not only did Lincoln and Kisum realize this was a problem, they wanted to do something about it.
Order the floor
The duo met at University College London and started this project in their sophomore year. Lincoln is Malaysian while Kisum is from Hong Kong.
They came together for a competition called the HULT Prize, an international annual competition for emerging social entrepreneurs that works in partnership with the United Nations.
Her team won in 2018 and received $ 1 million (RM 4.1 million) to carry out their work of reducing rice waste and ensuring 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.
In 2020, they later met Jonathan and Zheyi, both Malaysians, who joined them on their mission. Together they run Rice Inc., a UK company currently operating in Myanmar and Malaysia with plans to physically expand to Malaysia soon.
The Rice Inc. team / Photo credit: Rice Inc.
Now they had two rice growing problems to solve: farmers who weren't paid fairly and the crop losses they usually suffered.
To ensure fair trade for rice farmers, they will connect them directly to high-quality markets at fairer prices. For example, they are currently bringing artisanal rice from Sabah to Kuala Lumpur and Singapore via Paddi, and selling rice in the UK via a brand of the same name.
To reduce crop losses, they introduced Agritech for Drying Rice, which uses the by-product of the rice harvest, AKA the husks, as biomass energy to run this machine and dry rice evenly.
Problems with the traditional way of drying rice
“Rice is usually dried under the sun. This is a manual process that requires a lot of work and usually takes much longer. It takes up to 5-6 days compared to 5-6 hours with a machine, ”the team told Vulcan Post.
Compared to this machine, this traditional way of drying rice is also much less accurate, resulting in rice being too dry or too wet.
“Rice has to be processed with a very specific moisture content of around 12 to 14%. Deviations from this lead to breakage and thus to waste. "
In addition, there is a risk of contamination from the environment, weather changes and animals entering the drying room. It is therefore important to ensure a more efficient and less exposed environment when drying rice in order to reduce crop losses.
How Rice Is Traditionally Dried / Photo Credit: Rice Inc.
As mentioned earlier, the rice husks are used as biomass fuel and power these dryers by generating heat which is then passed through a fan into a chamber where the rice can be dried.
The Rice Inc. team installed a dryer in their beneficiaries' villages that farmers can access by bringing their moist rice to them after harvest and drying it for a fee. Lincoln compares its business model to the pay-per-use model of a laundromat.
They currently have two locations in Letpadan, Myanmar, with a processing capacity of over 3,000 tons per year, and they plan to bring this Agritech to Malaysia soon.
Let's talk about numbers
These rice clothes dryers cost an average of $ 10,000 per unit to install. Of that $ 10,000, $ 6,000 is used to purchase the machine and $ 4,000 is the cost of setting it up.
"By simply providing a dryer, we can increase the farmer's income by 15% due to the price difference between wet and dry rice," they said. One session can dry up to 5 tons of rice and costs a farmer about 165 RM.
According to the team, 5 tons of dried rice field means an increase in the average income of farmers by 820 RM, which means they can earn about 8,204 RM for this traditionally dried amount, compared to the standard of 7,384 RM. By paying RM165 you will get 5x return on the cost.
Farmers can also expect their sales price to increase by 15% due to the increase in their dry rice yield.
The machine used / Photo credit: Rice Inc.
Now farmers are not paid monthly like the rest of us, but in April and November, the harvest times. Therefore, they usually take on odd jobs for the rest of the year.
"Our studies have shown that most rice farmers belong to the B40 group and, according to this study, have an average household income of RM 2,527 per month from 2016," they said.
However, they made it clear that they are first working with artisanal rice growers (black rice, red rice, etc.) which is why the higher retail prices for this rice are already there which helps to pay for them better. Your job is to ensure that most of the final sale price goes back to the farmers rather than going to middlemen and other costs.
"We support them with marketing and advertising as well as with the optimization of logistics and the marketing of the rice price, which is set by the community."
Your farmers can choose how much they want to make working with them, and they just advise them on an appropriate price for premium rice and how much Malaysians would be willing to pay for it.
Lincoln and the Peasants / Photo Credit: Rice Inc.
Challenges in running the business
"Whenever we negotiate business or conduct interviews, we always need a translator, which means that each conversation takes twice as long because we cannot communicate in Burmese," they told the Vulcan Post.
When the coup happened, they also had to cease operations in Myanmar for a while and adjust by continuing their work in Malaysia.
In addition, many of these retail stores closed due to COVID-19 when they were already getting enough traction in the UK with orders of 100 to 400 tons.
"Much like Fairtrade Coffee has worked with big brands like Starbucks, we are currently looking for our 'Starbucks'."
So the team is now trying to capitalize on this demand for paddi from major retailers and grocery chains to bring more Kampungs to their direct trading platform and give more farmers the ability to connect directly to high quality markets. To achieve this, they are looking for interested people who want to work together and support their farmers' networks.
Editor's note: Some parts of the article have been edited for greater accuracy.
- More information about Rice Inc. can be found here.
- More articles on Agritech can be found here.
Featured image source: Lincoln and Kisum, co-founders of Rice Inc.