Anderson Hay and Grain Co.
California Air Resources Board

"Preprocessing of Rice Straw for Multiple Products"

Rice Fund Progress Report Summary
Q2: October 1 - December 31, 1998

Introduction

Efforts and resources were focused very strongly on harvesting of rice straw, e.g., infrastructure development. Q1 and pre-Q1 planning and preparation with our rice grower group paid off as we entered our harvest phase the second week of October. Japan visits regarding export issues were set up and executed. Preprocessing activities remained dormant, albeit under discussion with our pulping partner for Q3 timeframe.

Inquiries from potential endusers of straw increased significantly, most of them coming from applicants in the 1999 round of rice grant funding. These inquiries underscored the value of our field trials this first fall. We have spent a good deal of time explaining the fundamentals of having a straw supply -- generally first-time, somewhat sobering reports for prospective endusers of large quantities.

Infrastructure Development

Baling began October 7, a month later than normal years due to late planting and subsequent late harvesting. Baling equipment and rakes were trucked down from Oregon during the first week of October, set up, adjusted, and put into the fields. Steve Van Mouwerik, Project Manager, and Greg Nichol, California Supply Manager, oversaw the harvest procedures. Baling lasted until October 26. Stacking, trucking, consignment to winter storage stacks, and tarping carried well into mid-November. 2,500 tons were baled. A great deal was learned about harvesting rice straw.

Erosion Control Blankets

About 40% of the rice straw baled was transported from fieldside stacks to Greenfixís erosion control blanket manufacturing facility in Brawley. This tonnage is under tarped storage in a much drier setting adjacent to the processing facility. Executed comparative product field slope testing for rice straw blankets.

Rice straw erosion control blankets can be considered a success on a performance basis. Rainfall simulator blanket performance thus far shows soil loss and infiltration parameters are substantially better for rice straw blankets than traditional wheat straw blankets.

Recent developments in State Department of Transportation (DOT) departmentsí product approval standards and methods have placed the Texas Transportation Institute, the Texas DOTís testing arm, as the standard bearer for erosion control mats that might be used by other state DOTís. Their results are published for all DOTís to use in determining their product choice. Greenfix has succeeded in getting its rice straw mats on a fast moving testing and approval track. This will prove to be critical in establishing the rice straw mat as a valid, accepted product with the key market for erosion control Ė state DOTís.

Forage

Progress in developing Japan for California rice straw imports has been quite encouraging. The bilateral talks in September resulted in ongoing exchange of concerns and information regarding rice straw issues between Japanís MAFF (Ministry of Agriculture, Forestry, and Fisheries) and our USDA (United States Department of Agriculture.) In particular, MAFF provided a list of pests that concern them and requested USDA respond with comments on them and their treatment.

The timely review by MAFF of other exporting countries of rice straw to Japan puts California in the company of established rice straw importing practices, strengthening our position and chances. We remain cautiously optimistic.

Ron Anderson, representing the National Hay Association, met in Japan this fall with individuals at the USDA who attended the bilateral talks in September and who are pursuing this issue on behalf of Andersonís inquiries. Ron Anderson is Export Committee Chairman, National Hay Association.

Steve Van Mouwerik visited Taiwan to learn more about treatment practices for Taiwanese rice straw destined for the Japan feed market. After a hiatus of over two years due to hoof and mouth disease having broken out in Taiwanese swine, these treatment talks with Taiwan are of interest to us. Japan is requiring that rice straw for export to Japan be heat treated in Taiwan at Japanese inspected and approved sites.

Preprocessing Rice Straw

We provided numerous laboratory- quantity samples of pre processed rice straw to parties considering rice straw projects using their technology. In every case, we have basic, educational discussions of supply and supply management, from the growersí fields to the point of use.

Various fund applicants frequently contacted Steve Van Mouwerik during Q2 to discuss straw supply issues and questions. We expect to process about 50 tons of rice straw during Q3/Q4 which is the amount originally scheduled for Q2.

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