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Rice market chain in Arkansas, the leading rice state
20 | 06 | 2007
Arkansas is the leading rice-producing state in the U.S., representing 48.7% of the total U.S production and 48.6% of the total acres planted to rice. There are nearly about 9,000 big farmers working on rice in Arkansas, and they are tightly cooperative with farmer-cooperative firm for marketing their products, and with research and agricultural extension agency for consuming research results for their crop production.

Arkansas is the leading rice-producing state in the U.S., representing 48.7% of the total U.S production and 48.6% of the total acres planted to rice. There are about 9,000 farmers working on rice in Arkansas. The crop areas cultivated by each farm here is more than 3,000 acres, including rice, soybean, corn, wheat. The agricultural sector is capital intensive: there are few farmers, and heavy investment in machinery. Each farm includes only 2 or 3 people, and it invests in its own machinery for land preparation, seeding rice varieties, harvesting the rice, collecting hay. It costs about 500,000 USD to invest in the machinery. There are several manufacturer and supplier for all machinery: John Deere, and Case in. John Deere Co., established in the 1890s, is one of the oldest companies.

John Deere Co., absolutely focused on building its brand name at the starting time. There is no different in color (green& yellow) between the 2 machines: One (on the left) was manufactured in 1928 (now shown in Museum of the Arkansas Grand Prairie, Stuttgart, Arkansas) and other manufactured in 2000s (on the right)

The farm consumes seeds, fertilizer, pesticide provided by a seed company. The seed company doesn’t charge farmer to send agricultural technical experts to visit the farm weekly, to control the situation of crop’s growing, recognize crop diseases and offer their solutions. The Arkansas farmers have established the Rice Research Promotion Board, whose founders are farmers.

The big problem for rice crop production in the U.S. is water resources. About 80% of irrigation for U.S farms now is based on underground water. U.S. farmers need to invest in the irrigation system for crops by themselves. All of the system is underground constructed. U.S. Irrigation Distributors and U.S. Pipe Co., are two U.S. suppliers for equipment and technology to build such a system. A farmer we interviewed said this system takes a lot of money, which may come from the savings of several generations of their families. Rice farmers often participate in the farmer-cooperative firm. About 60% of Arkansas farmer have joined Riceland Food, which is a farmer cooperative firm.

Pump station invested by farmer David for crop production

Irrigation system is underground constructed. The average investment cost is around USD 3,700 - 4,000 per acre.

Riceland is the world's largest miller and marketer of rice. Riceland provides marketing services for rice, soybeans and wheat grown by its 9,000 farmer-members in Arkansas, Louisiana, Mississippi, Missouri and Texas. Riceland locates its storage and export terminal along the Mississippi river. The condition for farmer to become a member is only 1 USD fees/ year. After becoming a member of Riceland Food, the farm will decide its obligation to the mill (the amount of rice they will supply with the mill). Each year, Riceland’s 1,900 employees receive, store, transport, process and market more than 125 million bushels (2.5 million metric tons) of grain. Generation after generation of Riceland farmers have planted, cultivated and harvested rice that carries the quality promise of Riceland Rice. That tradition continues today. Each Riceland product is backed by generations of rice farmers whose goal has always been to produce the finest quality rice in the world. Riceland leaders said they can only attract membership by maximizing the rice prices that the farmers can receive.

One rice store of Riceland Food Co., Stuttgart, Arkansas State, May 2007

Author (lady on right side), Dr. Nathan Childs, Rice analyst of ERS, United States Department of Agricultural (man in the middle) in front of a rice store

Riceland Foods has invested in and run its full-cycle processing lines for rice: from rough rice, to get brown rice, to milled rice, to parboiled rice. The rice milled outputs at the end of processing line can come be delivered to different channels: (i) directly to rice containers which will be delivered immediately by train, (ii) to packing segments (more than 5 types of Riceland packages). The rice milling rate from paddy (rough) rice to milled rice is 69-72% in the U.S. During milling, each kilogram of paddy rice yields about 55% head rice and 15% broken rice. Currently, the broken rice is used chiefly by the pet food industry. The beer brewing industry has switched its purchases to head (unbroken) rice, instead of broken rice.

Hoang Ngan, Information Center, Institute of Policy and Strategy for Agricultural and Rural Development, www.agro.gov.vn

Written from trips in Arkansas State, The United States, May, 2007



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