The rice man cometh

MANILA, Philippines - “My mom is the boss.”  This 30-something knows who calls the shots in the innovative company he manages with his mother and many more women staff and rice sorters.

Carlo Calma Lorenzana went back to Davao in 2009 after jobs in a TV station and a drugstore chain. “I wanted to be a politician,” he says with all candor. “After working in these companies I realized I can make a change not through politics, but through business.”

The Lorenzanas found a rundown rice mill in Davao del Sur whose operations were not very efficient, and Carlo soon found himself reorganizing the operations with his mother. After we were introduced in 2010 during a visit to Davao, Carlo started supplying us with his freshly-milled brown rice under his label SunMade. I thought it was nice for a young man to brand a commodity like rice and hope to succeed in it. So we supported his cause, knowing it was freshly-milled and was good to serve in our ECHOcafe and our erstwhile restaurant Le Bistro Vert.

To further promote brown rice, we even held a media event for his brown rice paella served with his other passion, Lagarde Argentinian Malbecs. We served only brown rice in our two places because we knew the source. After all, Le Bistro Vert and ECHOcafe  promoted “farm to table” and traceable ingredients.

We met Carlo for lunch recently at yet another baby of his, La Cabrera Argentinian Grill, to catch up on the many developments in his rice business.

He developed the business from zero to a few hundred tons a year, milling organic rice from farmers he knows in a 20-hectare area in Davao del Sur.

“Why didn’t you say it was organic?” I asked. He answered that he still needs certification but that it was on his plate to now start this process.

Then he went on to tell us other good news:

He hires women to sort the rice, remove black and damaged grains, and ensure all the rice he packs are clean of foreign matter.

He works with a female agri-technologist, a woman supervisor in the mill and, of course, the top gun is his mother. How nice of this young man to relate to us his secrets for success: the women behind him and on top of him.

Nothing bad about hiring men versus women. It just so happened that the women are the ones who like the business of rice sorting and grading. And making sure all his clients get the best freshly-milled brown rice there is.

Carlo knows the window for local rice protection from foreign imports will soon close, so he is doing his homework. He has many clients but he is hard-pressed looking for more farmers who are willing to follow his standards. He also needs more financial muscle to assure farmers he will be there to buy their produce. Sadly, farmers have short financial cycles and need to be paid as soon as they bring their crop to the mill. As he monitors his organic rice producers, making sure they can deliver the needed volume, he sometimes loses them to traders who just bring out the money and are not part of any organic protocol. Traders then mix these rice with other harvests and the whole lot is no longer organic.

It is the same with coffee and any other fresh crop. Organic produce gets mixed or “jumbled” with other lesser kinds, and then get the same commodity prices at market level. While we have the likes of Carlo paying a premium for organic rice to the farmer, economics sometimes forces the farmer to sell out to traders even at just a peso less per kilo.

So, this is where Carlo will be getting help, from people who know the organic supply chain and the difficulty of keeping it pure and unadulterated. We will refer him to Peace and Equity Foundation, which now helps farmers scale up, and helps processors and marketers like Carlo to scale up as well.

Carlo has come up with his business model – organic brown rice that is freshly-milled in his premises and sold directly to specialty stores and supermarkets. He has taken care of the supply chain and assures his buyers that he will come up with the required volumes.

His SunMade brand brown rice is now carried by many supermarkets who sell the vacuum-packed variety. Fresh organic rice must be vacuum-packed to prevent natural bugs from growing. So, make a note of that and do not prick that vacuum pack as it allows natural insects to multiply. Remember that what is good for insects is good for man. And that is the test of natural.

His model is replicable elsewhere in the country and he hopes to be able to do this business style in the Visayas and in Luzon as well. Given that profits are marginal, transporting rice is not a very sound business idea. So it has to be milled closest to source.

He proudly shares that his “freshly milled” idea came by accident. He did not have much money to turn around so he would buy rice only as orders came in; he thus had “freshly-milled” rice, which became his selling point. And it is organic because he protected a number of hectares of rice and made sure organic practices were in force. He also paid a nice premium to the farmers to keep the rice pesticide-free.

Carlo will probably not become a politician as he dreamed, but definitely he wins the hearts of farmers much better than a politician ever could.