Compact Rice Mill as a Profitable Investment

By Zac B. Sarian

Small scale entrepreneurs in the countryside might as well take a second look at a compact rice mill that can perform the functions of bigger models.

This is the model LH 5001 from Korea which is now available in the Philippines through a company that represents the cooperative of farm machinery manufacturers in that country.
Philip Kim, president of Fitcorea, which distributes the compact rice mill, says LH 5001 can be a profitable investment.

The compact LH5001 rice mill.

One very good reason why it can be profitable is that the mill has a high milling recovery rate of 68.1 percent. This means that for every 100 kilos of palay milled, 68.1 kilos of polished rice is recovered. This is much higher than the usual milling recovery rate of other small rice mills that ranges from only 55 to 60 percent, according to Philip Kim.

Moreover, the polished rice comes out to be of high quality because as much as 77% of the grains are whole grains, and only 23 percent are broken. Whole grains, of course, command a higher price in the market. There is another reason why the rice milled with LH 5001 is of higher quality. The machine has a husk separator, rice bran separator, impurities sorter, an
adjustable polisher control and a stone separator. The milled rice is therefore very clean.

Being compact, the machine can be installed in a place as small as 9 square meters. And it can be operated by just one man. LH 5001 can mill 5 to 6 cavans of palay in one hour.

The investor can install one in a community where small rice farmers produce quantities that the big rice processing complexes will not care to accept. Fitcorea staff member Malou Bautista says that even if the machine operates only five hours a day, the operator can gross about P75,000 in fees of P2 per bag of polished rice. The expenses in electricity and other costs total only R21,500 per month so there is a profit of R53,500 monthly. That’s not bad for a small business in the countryside.

Usually, small rice farmers sell their palay right after harvest because they need cash to settle their loans or for some other purposes. If they can have their harvest milled and sell the same
as commercial rice, they will significantly increase their income. This is how Malou Bautista explains it.

Many farmers harvest 120 cavans of palay from one hectare. If they sell the palay at P17 per kilo, the gross income will be P102,000. But if they have their harvest milled by LH 5001, they will get total of 3,900 kilos of polished rice. Because the rice is of high quality, that will sell at P42 per kilo and the gross value will be P163,000. The cost of milling is only P7,800 so there is an increase in income of P53,200 for farmers who have their palay milled and sell the same as commercial rice.

So, there you are. Why not give the compact rice mill a second thought?

This appeared in Agriculture Monthly’s May 2016 issue. 

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  1. Can u give me the quotations?

    1. Hello!

      Kindly contact the subject of the article directly, thank you!

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