World Grain - May 2008 - 61

RICE NEWS ROUNDUP

NutraCea purchases Irgovel
PHOENIX, ARIZONA, U.S. - NutraCea
announced on Feb. 22 that it has completed
the purchase of Irgovel, the largest rice bran
oil processing facility in South America,
for approximately $14 million. The facility, which has an annual capacity of 70,000
tonnes, is located in Pelotas, Brazil. It will
provide NutraCea with the opportunity to
sell rice bran oil in addition to its entire portfolio of patented and proprietary stabilized
rice bran and stage-two derivative products
into the Brazilian and global marketplace.
NutraCea announced its intent to purchase the facility on Feb. 4, subject to certain closing conditions. The company paid
$14,080,000 for all of the outstanding equity
interests in Irgovel. In addition, the company
may provide capital to Irgovel as necessary
to fund approximately $5.3 million in installment payments owed by Irgovel to the Brazilian government for deferred tax obligations.
These deferred tax amounts are payable over
a period of 10 years.
The 40-year-old rice bran oil facility is the
largest in South America. Currently, the plant
is operating at about one-third of its capacity.
NutraCea anticipates investing approximately $4 to $6 million to refurbish, upgrade and
install their proprietary equipment into the
facility and expects to complete this project
by the end of this year.
"When running at full capacity, we believe
that the plant can generate approximately

$30 million in annual sales from the rice
bran oil. As previously announced, NutraCea
will install its proprietary technology during
2008 to improve the dynamics of the traditional rice bran oil extraction business for the
production of higher value-added derivative
products. We anticipate these new derivative
products could result in meaningful addi-

tional revenue, beyond what is stated above,
beginning in 2009," said Leo Gingras, chief
operating officer of NutraCea.
NutraCea has entered into marketing arrangements, which it believes will allow the
company to sell the plant's current production capacity as well as all future expanded
production.

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Philippines seeking
Asian rice summit
MANILA, PHILIPPINES - The Philippines, the world's largest rice importer, said
in mid-April that it is urging China, Japan
and other Asian nations to attend an emergency meeting on the region's food crisis to
try to reverse export curbs that have driven
prices to a record high.
"Free trade should be flowing," Filipino
Agriculture Secretary Arthur Yap said April
14. "We would like to take up the export
bans being imposed by several countries."
The meeting might be arranged within two
months.
Prices for grain, including rice, have
surged this year on concern of a global shortage, prompting some growers to impose export curbs.
The states to be invited to the summit included the 10 countries of the Association of
Southeast Asian Nations, plus India, South
Korea, Pakistan and Bangladesh, Yap said.

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