Laotian rice making waves in international markets.
Indochina Development Partners Lao Sole Ltd (IDP) was established formally in January 2016 and registered in Savannakhet province, Lao PDR. As a rice milling company, IDP’s main business is processing rice from paddy for the export market. The corporation also produces rice seeds, which are provide to farmers as a form of credit. These are then repurchased post the paddy output.
IDP’s goal is to have a long-term relationship with Lao farmers, who in turn produce high quality rice which meets the requirements of international markets. It is also focused on its mission of being the leading glutinous rice producer and exporter in Laos.
IDP presently exports its products to several countries in Europe, Australia and Asia, focusing on China and Vietnam. Many of its clients are food ingredient producers and wholesalers who have branches in multiple countries. In the pipeline are also plans to extend to the USA and Canada, a market IDP views as prime for their organic rice products.
The formative years were challenging for IDP but the company managed to build a team of 200 strong within the first six months, notwithstanding the fact that many of its first hires were relatively inexperienced in the rice industry. Overcoming the initial obstacles, IDP succeeded in becoming the first company in Laos to export glutinous rice, and to have introduced Lao rice internationally, all within a span of less than five years.
Where product differentiation is concerned, IDP believes that they are the only company in Laos applying quality control systems over their products, resulting in far superior quality products offered at international levels. In addition, Laos is renowned for the nation’s traditional farming methods of glutinous rice production, which omits the application of fertilizer. With its business model, IDP strives to add value to the entire rice supply chain, from seed production to the export of the final product, delivered to international quality standards.
Among the challenges faced by IDP recently has been the shortage of paddy due to the low price of rice across markets recently. Additionally, Laos is hampered by less than effective irrigation systems, resulting in a bountiful first harvest, before yield tapers off for the rest of the year. A lack of understanding in the fluctuating market price mechanism has also resulted in farmers not wanting to sell when the market price is comparatively lower than previous years.
To counter these challenges, IDP works closely with the farming community, educating farmers on new rice farming techniques as well as the commercial aspect of the business, towards further understanding of market price trends.
IDP maintains that in order for SMEs to succeed beyond the markets they operate in, companies have to constantly improve their systems and take the lead in applying new technology and strategies to their products and services.
In the mid to long-term, IDP sees itself expanding globally, powered by a strong management team which continuously strives for improvement and growth. The company is confident that its reputation in its current markets, as well as the ability to evolve with changing trends, will take IDP to greater heights in the very near future.
In the meanwhile IDP will continue to focus on capacity building within the organization. On-going training for product identification and quality check methods are already underway, with plans for more external training in international standard programs.
IDP acknowledges that winning at ACES 2022 would be a great recognition for the years of effort invested, with the exposure helping to strengthen their position in the industry, as well as opening new opportunities in other markets.
“In nations where free enterprise is still a new concept, it is heartening to see a country’s major rice production conglomerate working to enrich farmers both by a ready purchasing chain, as well as efforts to educate producers of the world economics and business principles.”
Shanggari Balakrishnan, Chief Executive Officer, MORS Group