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«® Ricegrowers’ Co-operative Limited trading as SunRice ABN 55 007 481 156 The rice growing family spans many generations TABLE OF CONTENTS Who We ...»

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In the important markets of Japan and Taiwan, our strategy of positively differentiating Australian Medium Grain from that supplied from other countries resulted in SunRice being awarded sales through government procurement tenders. Regrettably, the greatly reduced availability of Australian rice significantly curtailed the overall volume of business conducted with these markets over the course of the year. SunRice Marketing will work towards recovering this loss of market share as soon as local supply allows.

Pacific The Sunwhite, Island Sun and Sunlong brands – now consolidated under SunRice master branding – continue to successfully drive our business throughout the Pacific Basin.

Despite intensifying competition from other suppliers entering the Pacific, our business remains strong, with positive growth over the previous year. Penetration of our rice brands has been maintained and sales volume growth has been experienced in numerous important territories.

One key strategy throughout the Pacific region calls for the maintenance of close working relationships with both distributors and customers. This is central to ensuring the continued success of the SunRice branded business within the Pacific basin.

The Middle East SunRice defended its established consumer markets in the Middle East and drove longer-term growth into new market segments. SunRice’s successful external trading strategy supplemented the supply of Australian rice with carefully selected non-Australian product to maintain the presence of our brands in the key markets within the Middle East region.

SunRice has also continued to implement product extension strategies, including the launch of a complete range of rices in the Jordanian market, plus a major re-launch of the Basmati range in Saudi Arabia. Positive growth is anticipated following very encouraging initial results.

“Close working relationships with distributors and customers ensures the continued success of the SunRice branded business within the Pacific Basin”

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The full range of SunCreations ‘ready-to-eat’ rice meals In 2004, the Aqaba Processing Company (APC) completed its second full year of operation. This facility has enabled the packaging and delivery of quality assured products to Middle East markets. Preservation of our brands on-shelf is critical in such a competitive marketplace. In addition, APC made significant advances regarding safety, plant hygiene and operational controls. These initiatives and processes provide an excellent platform for profitable future growth.

SunRice is well placed to continue to successfully prosper in this region, through capitalising on its significant experience, strong relationships and recognised consumer brands.

Global Sourcing SunRice’s global sourcing activities again contributed significantly to profitability.

To offset the shortfall in the level of supply of Australian grown rice, the total volume of externally traded rice by SunRice increased notably in the past year. A number of sources around the globe were utilised in order to procure the right mix of product specifications needed to satisfy our diverse market requirements.

The trading team has worked extremely hard to operate within well defined quality and price parameters.

Sourcing has involved bulk cargoes through to contract packed finished product, and drawn on a wide range of rice varieties. Stringent quality assurance has ensured the protection of our consumer brands.

SunRice Brands Around the World

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Exceptional Facilities SunRice has an ongoing commitment to improving our operational facilities. Our exceptional milling and packing facilities and superior milling technology enable SunRice to continue to compete internationally as a low-cost producer of quality products.

SunRice continued to achieve efficiency and cost improvements and high food safety and quality standards in all areas of milling operations in 2004/05.

Speciality Rice Foods Group Leeton is home to the Speciality Rice Food Group that manages the processing, packaging and manufacturing of a range of value-added rice foods. These include: rice cakes, ultra-convenience meals, side dishes, express cups and sachets.

The brand new ‘ultra-convenience meals’ plant continues to manufacture ready-to-eat meals under the SunCreations brand and was recently reconfigured to accommodate the introduction of added protein, such as meat.

The rice cakes plant has had a major investment to upgrade capacity for the development of a range of innovative packaging and products.

Best Practice SunRice places an emphasis on best practice safety management in all operations. In particular, our behaviour-based safety program, which is now fully integrated into all operations and is the platform for continuing sustained improvements in our industry. Two mill sites continued their lost time injury free status over 2004/05.

“In August 2004, SunRice was named the winner of the multi-site low-risk category of the Australian HACCP awards” In quality management all sites maintained their Hazard Analysis and Critical Control Points (HACCP) accreditation during the year. SunRice also continues to improve the appearance of it’s facilities with a focus on cleanliness and hygiene. In the past year, our Deniliquin and Leeton mills received accreditation under the AIB (American Institute of Baking) protocols for hygiene and food safety systems.

In August 2004 SunRice received recognition for its continued efforts in quality management and was named the winner of the multi-site low-risk category of the Australian HACCP awards.

SunRice competed in this category against many of the major food companies in the country.


Supply Chain Management SunRice is aware of the need to minimise supply chain costs when moving products to different markets. As a result of lower Australian rice production, SunRice has reconfigured its supply chain in domestic and important international markets. This has placed significant focus on processes to ensure effective delivery and cost control.

Key supply and service contracts have been reviewed throughout the 2005 Financial Year, resulting in savings for the business.

–  –  –

Six Sigma In 2003 SunRice launched a new business improvement methodology into the business, Six Sigma. This methodology, which equips people with the training, tools and techniques to implement change with critical thought has been fully integrated into the operations of SunRice.

This year Six Sigma will continue to be used for continuous improvement in the quality of products and processes, customer service, business costs and profitability.

Numerous projects focusing on cost, quality and customer service were completed throughout the year and have resulted in improved efficiencies across the company.

Grain Handling Grain handling operations achieved significant improvements in reducing costs across all areas.

The business continued to earn revenue from the storage of non-rice grains during the year due to the available storage capacity resulting from the low rice crop.

SunRice continues to review its technologies and processes to ensure the company is running an efficient, effective and low-cost operation.


Employees demonstrated their resilience, adaptability and ongoing commitment to SunRice in 2004/05.

The continuing drought has been challenging for all associated with the industry. It was necessary for SunRice to review and restructure the business to accommodate the substantially reduced crop, and regrettably, a number of people were made redundant. The efforts of all employees, both past and present, is acknowledged and appreciated.

Strong Leadership Strong leadership at all levels of the business has driven this year’s business results. The contribution of every individual focused on a common goal has delivered a successful outcome this year.

Because of the importance of frontline leaders, during the year we undertook programs to develop the skills required by SunRice employees to enable them to better manage their teams and improve performance.

The opportunity to grow and develop within an organisation is important for both individual career paths and organisational succession management. During the year, it was pleasing to see many employees within Operations, Supply Chain, CopRice, Corporate Services (which includes Internal Audit, Customer Service, International Marketing and Information Services) and Trukai promoted to more senior roles.

With the increasing importance of international trading a Global Sourcing Team was established to focus on the significant level of offshore activity. Employees within this team are leveraging their current skills and knowledge, and developing new competencies, to fulfil their additional responsibilities, especially in areas such as procuring product, managing global shipping logistics, ensuring quality of internationally sourced rice and delivery of product within the required lead-time.

This is achieved in the context of a diverse range of people and cultures.

“Strong leadership at all levels of the business has driven 2004/05 business results” Employees across the business were recognised throughout the year for their service to SunRice, with 32 employees attaining five years service, 38 with ten years service, 3 with twenty years service and 1 with an outstanding thirty years service. Congratulations and thank you to all our long-serving employees.

Negotiations for the SunRice Workplace Improvement Agreement (WIA) were successfully completed during 2005. Employees, Management and the Union worked together over many months to set the platform for operations within the business until September 2006.


Employee Awards SunRice employees are central to the success of our business and we recognise those people who have demonstrated excellence, innovation and initiative through the SunRice Employee Awards. A total of 111 individual nominations and 44 team nominations were received from across the whole business. Each of the quarterly site winners were invited to a presentation dinner in Leeton on May 24 where the overall winners were announced.

Members of the Rice Cake Team, the All winners of the 2004 Employee Awards SunRice Employee Awards overall winner, overall Team winner for the 2004 Employee with Gary Helou, SunRice Chief Executive Frank Zumbo, Senior Project Engineer Awards with David Keldie, GM Sales and Officer, far right congratulated by Gary Helou, SunRice Marketing - Australia and New Zealand and Chief Executive Officer Gayle Philpotts, GM - People and Culture, far right The overall winner was Frank Zumbo for his efforts in the World’s Biggest Risotto. Frank was responsible for managing the engineering required to heat the 10 x 3.5 metre pan – the largest of its kind!

The Rice Cakes Team of Cameron Johnson (National Sales Manager), Nick Hinds (GHPL Account Manager) and Elena Mountain (Brand Manager) was the overall winner of the Team Award.

Individual site winners were: Coleambally Mill - Ben Elliott (Data Recorder & Domestic Dispatch), Coprice - Paul Marshall (Milling Technician), Deniliquin Mill - John Flisher (Quality Technician), Leeton Mill - Mark Pooley (Maintenance Fitter), Leeton Office/Engineering - Frank Zumbo (Senior Project Engineer), Sydney Office - Neil Lee (Demand Manager), Paddy - Paul Dickson (Paddy Operator), and from Speciality Rice Food Group - David Legge (Production Supervisor).

This year has again shown the calibre and dedication of SunRice employees. Congratulations to all staff on their ongoing commitment and contribution to SunRice’s success.


The resilience of Australia’s rice growers has been pushed to the limit with a third year of the worst drought in a century.

At the completion of the 2004 harvest, production reached 528,984 tonnes at an average yield of

8.2 tonnes per hectare. This below-average performance was due to low water allocations at the beginning of the season and the effect of cold weather damage.

After this disappointing 2004 crop result, growers and SunRice were hoping for above-average winter and spring rainfall to replenish storage dams. This would have provided sufficient water to irrigate the large winter crop planted, grow a more ‘normal’ 2005 rice crop and pay back previous Snowy water advances.

Unfortunately, the much-needed rains did not eventuate.

To overcome the shortage in water supply, SunRice negotiated with Snowy Hydro Limited, in collaboration with Murray Irrigation, to source an advance of future Snowy releases. This resulted in an additional 100,000 megalitres for rice production in the Murray Valley.

SunRice provided financial incentives for growers to use the advance to increase rice production.

Incentives were also provided to those growers with groundwater supply to use their available water to grow rice.

At rice planting time, water availability was a low 26 per cent of entitlement in the Murrumbidgee Valley and 21 per cent in the Murray Valley. A late improvement in water levels lifted availability to 35 per cent in the Murray Valley by mid-November. A considerable amount of this water was used to irrigate winter crops in spring – a decision many growers later regretted given the low prices for these crops at harvest time.

“The severe and prolonged nature of the drought is affecting all rice growers” By the conclusion of planting, 45,455 hectares of rice were planted on 997 farms: 495 in the Murrumbidgee Valley and 502 in the Murray Valley.

Unfavourable Weather Conditions Vegetative development of the crop was below average until weather conditions improved in late November. By the end of January, average to slightly above average yield potential was indicated.

However, unseasonably cold weather conditions in early February 2005 negated this improvement and reduced yield potential by 20-30 per cent. As a result, crops matured unevenly and late, with high levels of sterility. Yields were reduced in all regions and total production dropped from a potential 400,000 tonnes to 304,867 tonnes.


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