Identity Preservation: The key is selling the customer what he wants to buy.

By Dwight Roberts
President and Chief Executive
Officer, USRPA

The U.S. rice industry spent years, decades, building a reputation for high-quality shipments to both domestic and export buyers. The superior quality of our rice resulted in prices to growers being higher than in competitor origins. Our rice was the best, and buyers paid a premium for it.

That reputation suffered a near-fatal blow in 2010, as an extremely hot summer reduced grain quality and milling yields, especially in Arkansas. A lot of “ugly” rice ended up in supermarkets, and consumers noticed that, forcing millers in Central America to look for alternatives to buying our rough rice.

This was not a one-year problem. Supplies of poor quality rice remained in storage until 2013, leading mills in our primary markets of Mexico and Central America to search for and eventually purchase both rough rice and milled rice from other origins. This was not a small problem. Rough rice exports to Central America and Mexico were worth over $1 billion per year. On a tonnage basis, they made up about one-third of all rice exports.

Our “superior quality” reputation suffered, and we nearly lost some markets as finger-pointing replaced problem solving. There was an unproductive effort to blame hybrids, when, in fact, hybrids were providing many growers with significantly higher yields. This kept many rice farmers in business as international rice prices remained low, capping the prices that mills could or would pay for U.S. supplies. By producing more rice on the same acres, farmers survived to plant another crop.

No, the problem was not hybrids, but comingling varieties. Hybrids have a thinner bran layer and must be milled differently to optimize whole grain yields. To mix any dissimilar varieties together causes problem for a miller, regardless if they are from Arkansas or Mexico. Rice milling is an art, not a science, and traditionally varieties and qualities are kept separate in the drying and storage process. This way, the buyer/miller can assemble lots of the same variety or varieties that share characteristics of grain size and shape. The only way to do that is to keep each variety “Identity Preserved” throughout the storage, transportation and processing operations.

Proactive Efforts To Educate

As buyers began to complain about the quality of rice they were receiving, the USRPA took an active leadership role in working with export buyers and shippers to understand what was happening, then find commercially viable solutions that would keep the buyers loyal to U.S. rice.

USRPA organized meetings with various USDA branches, including the Grain Inspection, Packers and Stockyards Administration (GIPSA) and the buyers, but, most critically, invited buyers to the rice belt to see how they could get the kind of rice they wanted. Their suppliers had been telling them they could not, or that it would cost a lot of money. Eyes were opened.

We are pleased to report that several sales and shipments of Identity Preserved high-milling rice have been made, and more are in the process. USRPA will continue to educate our important buyers, and we are realistically hopeful of rebuilding the quality reputation for U.S. rice and regaining the extremely high market share U.S. rice enjoyed prior to 2010/2011.

In fact, the future holds hope for a return to growing top quality rice and letting buyers choose what they want to buy. Premium pricing will return. It’s a win-win for producers and their valuable customers.

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