SL Agritech enters regional pact on rice production and marketing

Hybrid rice producer SL Agritech Corp. on Tuesday said it signed deals with companies from Thailand, Myanmar, and Singapore on rice production and marketing in Asia.

 

A memorandum of understanding – a first in agriculture among members of the Association of Southeast Asian Nations – signed last month in Manila, covers a regional cooperation toward contributing specific expertise for the benefit of the venture.

 

Involved in the deal are Thailand’s Capital Rice International Co. (CRIC), IBTC Group of Companies-Myanmar, and Singapore-registered Radiant Stone Pte. Ltd.

 

A company listed on the Singapore Stock Exchange and owned by Filipino-Chine Julio Sy of the Tao Group,  Radiant Stone finance the venture as corporate investor.

 

“We have this opportunity to form an ASEAN joint venture where the Philippines takes the lead in hybrid rice technology,” said SL Agritech president and CEO Henry Lim.

 

 “We already own SL-8H trademarks in several Asian countries But this MOA offers opportunities for us to export to the big markets,” he added.

 

The agreement calls for SL Agritech to develop a hybrid rice variety using Myanmar's own germplasm, and made accessible through Los Baños, Laguna-based International Rice Research Institute.

 

SL Agritech will also lend IBTC a hand in producing hybrid rice seed in Myanmar in exchange for royalty payments. Myanmar has no existing commercial hybrid rice variety.

 

According to SL Agritech, a feasibility study will be available in December 2012 to determine the optimum area of planting and other profit-making opportunities.  

 

Once all documents required for an investment proposal, rice planting  is expected to start in Myanmar on January 15, 2013.

 

"We have five months at the start of 2013 to plant before the monsoon crop (in May or June)," said Myanmar’s U Aung Moe Kyaw.

 

A subsidiary of Myanmar’s International Sun Moon Star Agricultural Ltd., IBTC is one of Myanmar’s biggest beverage firms.

 

Around 30 years ago, Myanmar – then known as Burma – was the world’s largest exporter of rice. As the second last country in Southeast Asia, it has 

An estimated 6.14 million hectares of land for rice cultivation – or more than twice the area planted to rice in the Philippines.

 

Accounting for 20 percent of Thailand's total rice exports, CRIC offers the opportunity to export the commodity to big buyers like China and Indonesia, according to SL Agritech.

 

CRIC’s role in the regional venture is to determine the best model for marketing hybrid rice.

 

"There’s a big market for white rice in Asia. China has imported 1.4 million tons so far this year,” said CRIC director Anant Pitchetpongsa, noting that “Indonesia normally imports 500,000 to one million tons."