Rize Secures $31M to Assist Rice Farmers in Reducing Methane Emissions

Key Takeaways

Rize has secured $31 million in Series B funding, totaling $47 million to date, to enhance sustainable rice farming practices.
The company aims to reduce methane emissions and water usage in rice paddies, which contribute significantly to global methane emissions.
Rize plans to expand its network to 150,000 smallholder farmers across 300,000 hectares by 2030, utilizing new technologies and financial investments.

Funding to Foster Sustainable Practices

Singapore’s Rize has raised $31 million in Series B funding, combining efforts from climate-oriented and development finance investors. This funding escalates the company’s total financing to $47 million. Rize aims to decrease emissions and water usage in rice farming while maintaining yields and enhancing farmer incomes.

Rice agriculture is a notable contributor to global methane emissions, with paddies accounting for about 10-12% of these emissions due to traditional flooded cultivation methods. To address this, Rize advocates for alternative practices like alternate wetting and drying (AWD). This innovative water management technique periodically drains and refloods fields, effectively reducing methane emissions by 30-70% without sacrificing yield. Additionally, AWD conserves water—an increasingly pressing issue in Southeast Asia.

Transitioning to such sustainable practices, however, poses challenges. Farmers need initial capital, specialized knowledge, and a willingness to accept risks associated with crop yield fluctuations. Slav Gatchev, the VP of innovative finance at The Rockefeller Foundation, emphasizes the hurdles faced by smallholder farmers in Asia, including resource management and limited access to financing, which affect agricultural productivity and farmer welfare.

To facilitate this transition, Rize collaborates directly with rice farmers, employing a dedicated team of 50 agronomists and a proprietary mobile application to gather field data. This approach supports informed recommendations and integral measurement, reporting, and verification (MRV) systems. Rize’s emission reduction efforts are independently verified, as seen in its Sustainable Rice Production project, which has received a commendable rating from BeZero Carbon.

In addition, Rize ensures that its rice complies with maximum residue limits (MRL) required by premium export markets, enhancing its market competitiveness.

Plans for Expansion and Growth

Currently, Rize operates with 17,000 smallholder farmers across 50,000 hectares in Vietnam and Indonesia, successfully exporting 1,500 tons of low-emission rice to markets in Europe, Canada, Australia, and Singapore. The company targets expanding its network to 150,000 farmers over 300,000 hectares by 2030.

The Series B funding round includes a $20 million equity investment, spearheaded by BNP Paribas Asset Management Alts, alongside contributions from The Rockefeller Foundation, Temasek, and Breakthrough Energy Ventures. An additional $11 million in debt has been secured from UOB, BIDV, and the Temasek Foundation.

According to Rize CEO and cofounder Dhruv Sawhney, the new investment will facilitate the next growth phase, focusing on scaling operations, enhancing market linkage, and employing advanced technologies for improved decision-making and productivity. Future plans include broadening the application of AWD and ensuring MRL compliance among farmers in current markets, with potential expansions into new regions and involving other parties in the agrifood supply chain.

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