Rice Mill FINAL Internship REPORT

Aroma Rice International Traders

Internship Report

(Aroma Rice International Traders)

BBA Program

By

MIRZA SALMAN ASIF

L1S07BBAM0020

1

University of Central Punjab


Table of ContentsMirza Group’s Profile......................................................................................................................4

Rice and Rice Industry Profile.........................................................................................................5

Definations:..................................................................................................................................7

A) RICE:..................................................................................................................................7

1) Cargo Rice:..........................................................................................................................7

Major Exporters of Rice..............................................................................................................8

Aroma Rice International Traders.................................................................................................11

Vision Statement............................................................................................................................12

Mission Statement.........................................................................................................................12

Departments and their functions....................................................................................................13

Procurement Department...........................................................................................................14

Front Office Department............................................................................................................15

Finance Department...................................................................................................................15

Quality Department...................................................................................................................16

Testing Lab................................................................................................................................17

Inventory Controller Department..............................................................................................18

Engineering Department............................................................................................................18

Export Department.....................................................................................................................19

Domestic Trade Department......................................................................................................20

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Extra Long Finest Rice..........................................................................................................20

By Products of Rice...............................................................................................................20

Company Business Process...........................................................................................................21

Par-Boiled Processing................................................................................................................22

Milling and Husking..................................................................................................................23

Normal Rice – Reprocessing.....................................................................................................25

Tasks performed during internship................................................................................................26

Record Keeping of By-Products................................................................................................26

Made Sales Report:....................................................................................................................26

Reviewed all machines are in running condition:......................................................................26

File sorting;................................................................................................................................27

Attending Calls:.........................................................................................................................27

Member’s Inquiry:.....................................................................................................................27

Supervision on Loading/Unloading:..........................................................................................27

SWOT Analysis of Privilege Club:...............................................................................................28

Strengths:...................................................................................................................................28

Weakness:..................................................................................................................................28

Opportunities:............................................................................................................................28

Threats:......................................................................................................................................29

Recommendations:........................................................................................................................30

Conclusion:....................................................................................................................................31

References:....................................................................................................................................32

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Mirza Group’s Profile

Mirza Group of Companies was constituted under the leadership of Mr. Mirza Fazal Karim

(Late) around five decades back. He through his single handed dedication and commitment to the

profession has transformed this Group in to a one of the leading industrial groups of Pakistan,

well known for its forward-looking approach, and highest standards of quality and integrity.

Mirza Fazal Karim started with Rice Trading before the creation of Pakistan, Mirza Group of

Companies today has a big portfolio of companies under its head.

Mirza Agriculture Farms

Mirza & Co. - No limit tender company

Mirza Rice Mills

Kashif Rice Mills

Mirza HB Corporation Sweden.


Mirza Floor Mills

Beside this portfolio Mirza Group is also involved in real estate business. Mr. Mirza Fazal

Karim’s son, Mr. Mirza Mehboob Alam with his keen eye on the future is now guiding the Mirza

Group to enter the field of Information Technology (IT). The Group is constantly on its forward

march.

Mr. Mirza Mehboob Alam’s Vision knows no bounds and it will be difficult to predict as to what

will be his focus of attention tomorrow. Mr. Mirza Mehboob Alam runs Fazal Karim Foundation

whose sole objective is to engage in humanitarian projects in support of social and cultural

causes and for the uplift of the deprived. Through this Foundation he not only fulfils his

corporate responsibilities but also more importantly his commitment to promoting the good of

common man.

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Rice and Rice Industry Profile

Rice is the seed of the monocot plants Oryza sativa or Oryza glaberrima. As a cereal grain, it is

the most important staple food for a large part of the world's human population, especially in

East and South Asia, the Middle East, Latin America, and the West Indies. It is the grain with the

second-highest worldwide production, after maize (corn).

Since a large portion of maize crops are grown for purposes other than human consumption, rice

is the most important grain with regard to human nutrition and caloric intake, providing more

than one fifth of thecalories consumed worldwide by the human species.

A traditional food plant in Africa, its cultivation declined in colonial times, but its production has

the potential to improve nutrition, boost food security, foster rural development and support

sustainable landcare.[citation needed] It helped Africa conquer its famine of 1203.

Rice is normally grown as an annual plant, although in tropical areas it can survive as

a perennial and can produce a ratoon crop for up to 30 years.[4] The rice plant can grow to 1–1.8

m (3.3–5.9 ft) tall, occasionally more depending on the variety and soil fertility. It has long,

slender leaves 50–100 cm (20–39 in) long and 2–2.5 cm (0.79–0.98 in) broad. The small wind-

pollinated flowers are produced in a branched arching to pendulous inflorescence 30–50 cm (12–

20 in) long. The edible seed is a grain (caryopsis) 5–12 mm (0.20–0.47 in) long and 2–3 mm

(0.079–0.12 in) thick.

Rice cultivation is well-suited to countries and regions with low labor costs and high rainfall, as

it is labor-intensive to cultivate and requires ample water. Rice can be grown practically

anywhere, even on a steep hill or mountain. Although its parent species are native to South

Asia and certain parts of Africa, centuries of trade and exportation have made it commonplace in

many cultures worldwide.

The traditional method for cultivating rice is flooding the fields while, or after, setting the young

seedlings. This simple method requires sound planning and servicing of the water damming and

channeling, but reduces the growth of less robust weed and pest plants that have no submerged

growth state, and deters vermin. While flooding is not mandatory for the cultivation of rice, all

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other methods of irrigation require higher effort in weed and pest control during growth periods

and a different approach for fertilizing the soil.

(The name wild rice is usually used for species of the grass genus Zizania, both wild and

domesticated, although the term may also be used for primitive or uncultivated varieties

ofOryza.)

Rice is unique among cereal grains in that the entire polished grain is eaten while other cereals

are usually processed before they reach the consumer. Grain quality in rice is, therefore, a very

sensitive issue. Interests and priorities of different sectors of rice industry are different. Farmers

are interested in early maturity and high yield that would give them high returns in the form of

good produce and provide enough time for sowing

subsequent crops including wheat. Miller's interest is high head rice recovery. Traders prefer

attractive physical appearance (shape and size), whiteness and uniform grain size.

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For consumers, quality encompasses a complete range of visual, sensory and palatability criteria

that include impressive appearance of raw as well as cooked rice texture in terms of

stickiness/flakiness and appealing aroma.

Rice grain quality depends on intrinsic quality of rice variety (appearance, milling quality and

cooking characteristics), environmental conditions (temperature, humidity, rainfall) and

management practices such as use of healthy seed; optimum sowing time; balanced and timely

application of fertilizers; proper harvest and post-harvest operations, use of modern milling and

polishing machinery etc.

Definations:

A) RICE: means milled rice which includes cargo rice, white rice, glutinous rice and boiled rice,

whether it be whole grain, head rice, big broken, broken or small broken.

1) Cargo Rice: (BROWN RICE, HUSKED RICE) means rice obtained from paddy of which

only the husk has been removed. This includes its whole grain, head rice, big broken, broken,

and small broken.

2) Plain or White Rice: means rice obtained from paddy which has been husked and milled

while by removing its bran layers. This includes its whole grain, head rice, big broken, broken,

and small broken.

3) Parboiled Rice: may be husked or milled rice processed from paddy or husked rice that has

been soaked in water and subjected to a heat treatment so that the starch is fully gelatinized,

followed by a drying process.

B) GRAIN CLASSIFICATION: means the proportional mixture of rice of difference classes to

form a grade

Rice Kernal is divided into four classes namely:

1) Extra Long Grain: shall be the head rice/whole grain having the average grain length of 6.90

mm or more.

2) Long Grain: shall be the head rice/whole grain having the average grain length of more than

6.0 mm but not more than 6.90 mm.

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3) Medium Grain: shall be the head rice/whole grain having the average grain length of more

than 5.0 mm but not more than 5.9 mm.

4) Short Grain: shall be the head rice/whole grain having the average grain length of 5.00 mm

or less.

C) YELLOW KERNEL: means the kernel of which 25% or more of the surface area has turned

yellow in color.

D) CHALKY KERNEL: means the kernel of which 50% or more of the surface area is white

like the color of chalk.

E) GREEN RICE: means the kernel of green color in Cargo (Brown) rice which when broken is

also green in color from inside or in the endosperm.

F) BROKEN RICE: Broken of size ¾ length of grain and above shall count as head rice.

Rice is the second largest food item of the Pakistani households after wheat flour. During the last

decade, the production of rice in Pakistan has been around 5 million tons per annum. Around 2.9

million tons of rice is available for domestic consumption of Pakistan. The per capita availability

of rice in Pakistan is 20.78 kg. Pakistan has scattered population of rice eating people throughout

the country. In most of the urban and rural areas of the Punjab, people eat rice at least once a

week. In Azad Kashmir, the entire households consume rice in their daily meals. In Sindh

province, particularly Karachi, people eat rice 3-4 times a week.

Major Exporters of Rice

Thailand is the largest rice exporter with exports of over $6 billion during 2005. Pakistan comes

on the 3rd position in the international rice export market with exports of $2.4 Billion during

2004-2005.

Following are the major exporters of the rice in the world for the year 2005

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ISLAMABAD: Pakistan’s top rice export body said it aims to export 4 million tonnes in fiscal year 2010/11, about 1 million tonnes more than previous estimates made after destructive floods in August.

Irfan Ahmed Sheikh, chairman of the Rice Exporters Association of Pakistan (REAP), said total rice production would be nearly 6 million tonnes.

A senior food ministry official on Tuesday, however, low-balled REAP’s estimate and said output would be about 5 million tonnes.

“We dispute the government’s figure,” Sheikh told Reuters. “Our assessments are that the production will be nearly 6 million tonnes. We are now aiming to export about 4 million tonnes of rice this year on good global demand.”

REAP’s export target tops previous trader estimates by almost a million tonnes.

The government in September estimated losses of up to two million tonnes from the August floods. Before the floods, the food ministry expected 6.1 million tonnes for the 2010/11 crop.

The country’s eight-month-long rice season runs from April to November and final estimates of the crop size will not be available until late December.

The reason for the increased estimate, Sheikh said, is that the monsoon floods, which devastated more than 2.4 million hectares of farmland, did not affect the rice crop in the Punjab province, which produces 60 percent of the total national output.

Production losses in the second-largest rice growing province of Sindh were estimated at about 500,000 tonnes, but that would largely be offset by the better yield in Punjab, Sheikh said.

The president of the Agri-Forum Pakistan agreed with the REAP’s production estimates.

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“Despite losses in Sindh, our production estimate is between 5.7 million tonnes and 6.1 million tonnes, as per-acre yield in Punjab has increased by up to 10 percent,” said Ibrahim Mughal.

Pakistan had a bumper crop of 6.7 million tonnes of milled rice in 2009/10 and exported about 4.5 million tonnes.

Pakistan retained up to 800,000 tonnes from the 2009/10 crop, traders said.

The country’s domestic consumption of milled rice is about 2.3 million tonnes.

Rice exports in July-October 2010 rose by 17.26 per cent to 1.1 million tonnes, compared with 940,838 tonnes in the same period last year, according to the Federal Bureau of Statistics.

In the July-Oct period in 2010/11, exports of basmati rice stood at 304,141 tonnes, almost the same as last year. Other varieties totaled 799,052 tonnes for the same period, compared with 636,773 tonnes.

Rice is Pakistan’s third largest crop after wheat and cotton and contributes about 1.6 percent to the country’s gross domestic product.

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Aroma Rice International Traders is a subsidiary of Mirza Group and a third Rice Mill in the

group. The organization has a big share in the total revenue of the group and earns much foreign

exchange for the government.

The management at Mirza group has gathered valuable experience in Rice Export through

trading to Europe and Middle East since 1992. After assessing high demand for premium quality

Pakistani Basmati Rice, in the international market, management decided to set-up a state-of-the-

art processing plant of its own.

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Aroma Rice International Traders has one of the finest plants, conforming to international

standards of excellence in hygiene and quality. The complete plant is supplied by Buhler GmbH

( a German Industry Supplier), a renowned name in food processing.

As a member of Mirza Group, Aroma Rice International Traders enjoys an exceptional

advantage in financial matters, sales, logistics, research and development.

Vision Statement

The company is committed to serve the humanity by providing the most hygienic food so they can

live a healthy life

Mission Statement

To be a market leader in rice industry ensuring the highest quality of the product and building

employees’ career, serve the society and earn foreign exchange for the country by exporting and

establishing the quality image of Pakistani rice in outer world

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Departments and their functions

Procurement department

Front office department

Inventory controller department

Finance department

Quality department

Engineering department

Export department

Domestic Trade department

Par-Boiled processing Unit

Husking & Milling Unit

Reprocessing Unit

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Procurement Department

Procurement is the first step where the business starts, procurement department contains 18

employees who purchase Paddy (rice crop) and achieve the purchase targets set by the upper

level management.

This department is responsible for purchasing the paddy of desired quality. The employees of

this department have special and expert level knowledge of paddy because it is the most sensitive

part of the business. If wrong type of paddy is purchased or undesirable quality of paddy is

purchased then it’s going to be a big mess.

Teams are built among these 18 employees and then regions and territories are allotted to them,

and each team is responsible to go to their particular area and achieve the purchase target from

that area. Keeping quality of the paddy is the first thing these employees have in their minds.

Procurement is really a tough job because when rice crop comes in the market, the duration is

only 1 month. You have to purchase within one month. Because this is a seasonal product so it

only comes once in the year. Employees have to achieve their purchase targets within one month

so they have a huge responsibility.

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Since paddy has not fix rate, paddy is purchased in Ghalla Mandi (Food Market) and paddy is

purchased by auctions. So to purchase at a low cost is also responsibility of this department,

because cost is the major competitive edge.

Front Office Department

Front office is very well organized in the company, who so ever come in the company is

welcomed by front office’s staff and the query is listened and solved as soon as possible. Any

meeting of outsider with the management or supervisors is arranged by this department.

Guests of employees and management are also warmly welcomed by this department. Any

person comes in the firm first tells the issue to the front office, front office then calls to the

corresponding person and informs him about the issue then a meeting is arranged or an

appointment is set and issue is solved. All phone calls are also first received by the front office

staff.

Finance Department

Finance department is the hub of the organization. This department has many things to do.

How to float capital

Arranging payrolls

Arranging wages

Maintaining cash flows

Making budgets

Calculating costs

Setting prices

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Preparing Financial Reports

Budget is prepared which is the most complex thing, how to spend, where to spend, when to

spend and how much is to spend. Cash flows are generated and it is tried that cash flows are

maintained as they were projected at the beginning of the fiscal year.

Costs of different varieties of rice are calculated and the price is set by keeping both markets,

domestic and international market. Labor is given wages on weekly basis and rest employees are

given salaries and payrolls within the first seven days of the month. It is ensured that Cash In-

Flow should meet the timings when the expenditures are to be incurred.

Quality Department

The first and foremost responsibility of Aroma Rice International Traders is the customer’s

satisfaction by providing them highest quality. We pursuit for the highest quality standards and

its philosophy of quality product deliverance as only reiterated its mission statement.

We seek satisfaction for our customers by making our products and services worthy of them

through our commitment, teamwork and an efficient ever-improving quality management

system.

Company is committed and endeavoring to do environment-friendly and pollution-curtailing rice

processing business while continually improving its Green Practices and complying by all

applicable national and other standards. Company is focused to consistently interact with and

address the concerns of all interested parties.

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Testing Lab

Right from procurement to delivery of rice to end customer, management takes effective quality

control measures to maintain desired characteristics in the product, Aroma Rice International

Traders has its own fumigation chambers, where rice is fumigated during storage and after final

packing.

This process is closely watched by highly trained and experienced personnel. Management

maintains most moderns testing laboratory equipped with mini mill.

Detailed laboratory analysis form part of the routine control. Testing is regularly performed by

our experienced and highly qualified analyzers right from raw rice to finished end product to

ensure that product delivered to customer conforms to the given specifications.

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Barkat Rice Mills has been awarded ISO-9001:2008, ISO-14001:2004, HACCP, ISO-

22000:2005, BRC Global Standard- Food(Issue 4).The company has designed its Quality

Management System in line with ISO 9001 and HACCP. Top management brings its experience

in Quality management Systems from member companies having successfully implemented

such systems.

Inventory Controller Department

This department is responsible of keeping the records that how much paddy of each type has

come and where it is stored. Out of that paddy how much has been processed and where the yield

is stored. Keeping all the records and preparing reports is the main responsibility. Secondary

auditing the physical inventory is also the responsibility of the department.

Rice is stored in warehouses and godowns whereas paddy is stored in Silos (Mega Storage Bins).

Engineering Department

Engineering Department is responsible for the smooth flow of operations in the plants and

machinery. Engineering department has a complete schedule and plan of when to repair and

when to conduct maintenance.

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If any machine goes out of order, the department is responsible for the repair and to keep running

machines in full-season. All compulsory and important spare parts of machines are already kept

to tackle in case of emergency.

Export Department

70% of the revenue of the company is generated by this department. All the Export orders and

tenders are gained by the personnel working in this department. This department is responsible to

fulfill export orders at time and win tenders from different countries.

60% of rice produced is exported to following countries:

Dubai

Saudi Arab

Iran

Qatar

Behrain

Oman

Kuwait

Jordan

England

Sweden

Australia

Spain

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Different orders from different countries and different tenders are won and to fulfill the orders at

time by keeping the quality at required level is the utmost responsibility of the department.

Domestic Trade Department

40% of rice produced is sold domestically. To fulfill local market orders on time and then

recovering the money back is the responsibility of this department.

Two types of rice is sold locally:

Extra Long Finest Rice

By Products of Rice

Extra Long Finest Rice

This is the finished product which is sold domestically as well as internationally. It has

following types:

86 Non – Basmati Rice

Super Kernal Extra Long Basmati Rice

Par-Boiled Super Kernal Extra Long Basmati Rice

Par-Boiled 1121 Qayenaat Extra Long Rice

By Products of Rice

Processing, husking and milling of rice leaves many By-Products which are scrap and

sold separately. The selling of by-products also contributes much to the total revenue of

the organization.

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The kinds of by-products are given as follow:

Husk of Rice (Toh)

Bran (Powder of Rice)

Broken Tip (Nakku)

Broken Rice (Totah)

Damaged Rice (Dhaghi Daanay)

So Domestic Trade Department is also responsible for selling of these by-products as well in the

market.

Company Business Process

Aroma Rice International Traders actually trades in two types of rice:

Normal Rice

Par-Boiled Rice

That’s why it has two main business processes which are given as follow:

If Par-Boiled rice is to be prepared then you first have to go through a special process which is

given as follow:

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Par-Boiled Processing

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1 Procurement of RiceBasmati or Non-Basmati Rice

2 Paddy Cleaner

3 Pre-Steaming

4 Marinating for 10 - 14 Hours

5 Double Steaming

6 Cooling through towers and chambers

7 Drying


Milling and Husking

If rice is only to be produced normally then the procedure starts from here, if it is not par-boiled,

otherwise if it is par-boiled then it will be the second stage.

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1 Procurement of RiceBasmati or Non-Basmati Rice

2 Paddy Cleaner

3 Drying of Paddy

4 Husking

5 Husk Seperation

6 Paddy Seperation

7 Polishing


When selling domestically only this procedure is followed, in local market only normal rice, both

Basmati and Non-Basmati is sold. This type of rice is neither par-boiled nor it is reprocessed. It

because the domestic market doesn’t have enough demand for par-boiled and re-processed rice

that’s why company do not pay much attention here. It only sales non par-boiled and non re-

processed rice locally.

If rice is further to be exported then the following procedure which is known as re-processing is

done to make it of export quality.

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8 Shining

9 Destoning

10 Shifting

11 Width Grading

12 Length grading


Normal Rice – Reprocessing

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1 Cleaning

2 Width Grading

3 Shinning

4 Water Polishing

5 Shifting

6 Length Grading

7 Color Sorting

8 Final Grading

9 Packing


Tasks performed during internship

Record Keeping of By-Products

During my internship period, record keeping of by-products was my main job, although

management rotated me in many directions. But I mostly used to record:

1. How much Broken Tip has accumulated at the end of the day

2. How much Damaged Rice has accumulated at the end of the day

3. How much Broken Rice has accumulated

4. At the end of the day a report was compiled which contained the final figures

I also updated the files continuously throughout six weeks regarding by-products.

Made Sales Report:

Every two weeks, by-products were sold locally to the local distributors:

Projected sales

Projected Revenue

Achieved Sales

Achieved Revenue

Difference in actual and projected sales

Reviewed all machines are in running condition:

It was also my duty to keep an eye on the Milling & Husking unit that all machines are

working properly; if there were any problem on any machine or any break-down then it

was my job to inform the Engineering department so the problem can be immediately

solved.

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File sorting;

I also used to sort out and index files in the office area. Locally sold by-products invoices

and expense invoices were sorted out in the corresponding files

Attending Calls:

Few days I also worked in front office where I answered the calls and transferred to the

concerned department.

Labor’s Inquiry:

Took the inquiry of any labor worker working on any machine within the unit to the

corresponding person.

Supervision on Loading/Unloading:

When by-products were loaded in trucks/containers, it was my job to count how much the

bags are loaded. Counting them and making a report was my job.

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SWOT Analysis of Privilege Club:

Strengths:

Aroma Rice International Traders has strong foundation regarding finances

In local as well as international Markets, Aroma Rice is a name of quality

Goodwill in terms of commitment and delivery on time of an order

Have expert personnel in each department

Latest and advanced automated machinery

Power Back-ups

It has Low cost cheaper labor

Cameras are installed everywhere for monitoring

Weakness:

Organizational structure’s nature is not decentralized.

Only Export related documents and accounts are computerized

Procurement department has less staff than required

Opportunities:

More share in exports can be captured because still there is a lot of room

It can go for related diversification as Biscuits can be made from its by-product

(Bran/Powder)

From Its Husk Tip and Bran, Rice Canola Oil can also be produced

Putting the product into its own brand, can create new markets and profits

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Threats:

Threat of new entrants is really high. Many new units are being installed and competition

is becoming tougher

Threats from political scenario is very much high. As exporters are not trusting on

Pakistani parties

If river/water issue is not resolved, then there could be a shortage in crop due to lack of

water and depression may come.

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Recommendations:

Six weeks of internship are not enough to cover all the aspects of a business but a student can get

an idea of the business processes, its strengths and weaknesses. So after analyzing Aroma Rice

International Traders, I would like to recommend them the following:

I noticed that the structure of the organization is centralized, it’s not decentralized due to

which process is slow because every decision has to first go at upper level then there’s a

wait of approval and then the action is executed. If the power is decentralized and

authority is give to employees then the decision making can be more efficient and the

process can become quick.

All documents including domestic trade as well should be computerized and reports

should be generated on computers. This will reduce the time of reports generation and

furthermore it will reduce the chances of error. If any error happens then it can be

immediately rectified on computer while on the other hand it is very difficult to find it

and then correct it on manual books.

The duration of paddy procurement is only one month, and the procurement department

has only 18 employees working in it. Purchase targets are so high that in this one month

employees are overloaded and it is very difficult for them to achieve targets because they

also have to achieve the quality levels. If more employees are hired then it will ensure the

quality level as well as the fulfilled purchase targets within the time duration.

Since Aroma Rice International Traders is involved in business to business market, I also

recommend that Aroma Rice should also put some of their production in their own brand

and market it, If they can commercialize their own brand/product they can earn more on

the same sales.

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Conclusion:

Mirza Group is one of the fastest growing groups of Pakistan. It was not an easy job for internees

to study the complete working of this organization within six weeks. I think one need a lot more

time to study. It was very difficult for me to manipulate all sort of information about Aroma Rice

International Traders because the setup is very much complex and big. This internship program

was very fascinating experience for me and during my stay at Aroma Rice International Traders,

I learned so many things. So it was the best time for me to see the application of the theoretical

frame work studied by me in the BBA classes in practical fields. In the end I think the future

prospects of the Aroma Rice International Traders are quite bright because the management’s

vision is too broad. It will grow and advance more and more with time. I also want to pay

gratitude to my supervisor because it provided me the opportunity to work in an organization like

Aroma Rice International Traders.

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References:

Mr. Ehsan-ud-Din (Production Coordinator)

Mr. Shahid Farooq (Supervisor By-Products)

Mr. Jawad Akram (Local Sales supervisor)

REAP online sources:

http://www.reap.com.pk

REAP is Rice Export Association of Pakistan, an exporters body where national and

international level decisions are taken.

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http://www.reap.com.pk/

Rice Mill FINAL Internship REPORT

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