By Paul Scott Abbott, AJOTThe only rice-milling operation in the world located in a deepwater port has enhanced its break-bulk and bulk shipping capabilities this month with the opening of an expanded warehouse replete with a half-dozen new storage bins. American Rice Inc. (ARI), which nearly four years ago became a unit of Spain-based food conglomerate SOS Cuetara S.A., has held its unique dockside distinction since relocating its operation in 1986 to Port Freeport, on the Texas Gulf Coast, from downtown Houston, some 55 miles to the north. An ambitious expansion of the installation is now facilitating not only a boost in ARI’s rice operations but also a diversification into other food sectors, including olive oil. Considered the most efficient of U.S. rice-handling operations, the ARI facility capitalizes upon its dockside location with direct unloading of paddy rice from domestic barges and direct loading of bagged and bulk finished product onto oceangoing vessels for distribution throughout the world. “Our move to Port Freeport was instrumental in the success of ARI and in providing a market for Texas and South Louisiana rice growers,” said ARI’s president, Lee Adams, a 42-year veteran of the rice industry. While the history of ARI, through predecessor companies, dates back to 1901, the firm did not reach its current prominence until the strategic decision was made more than two decades ago to relocate facilities to Port Freeport from a downtown Houston site that even back then was becoming plagued with problems of big-city congestion. American Rice Inc. itself began in 1969 as a cooperative owned by rice farmers. In 1975, the company acquired the 40-acre Blue Ribbon rice mill property in downtown Houston, and it operated there for the next decade. Then ARI executives, including current president Adams, recognized the advantages that would be gained by centering operations outside the urban tangle and shifting them to a less-congested setting with ready waterside access. Since its Dec. 31, 2003, merger into SOS Cuetara USA Inc., ARI has been undertaking an expansion of its rice operations and has begun extending its horizons beyond its longtime roots as one of the world’s foremost rice marketing and milling companies. Grupo SOS, traded publicly on the Madrid stock exchange, has made a strong commitment to ARI and to the US market. Started in 1990 under the leadership of brothers Jesus and Jaime Salazar, with acquisition of the Sos family rice mill, the group now has 40 operating companies throughout the world, generating 1.6 billion euros ($2.3 billion) in annual business. “ARI’s acquisition by Grupo SOS was the best thing that has ever happened to ARI,” Adams said. “Today, we’re well on our way to becoming not only a rice company but a food company.” ARI’s Port Freeport facility now also serves as a distribution hub for imports of bottled and canned olive oil. Grupo SOS is the largest dealer of olive oil in the world, with its Carbonell brand the strongest-selling in the world. The olive oil currently is trucked in containers into Freeport from Houston and other Gulf ports that have regular European liner services. It then is packaged in bottles and cans, which are shrink-wrapped onto pallets for distribution throughout North America by truck and rail. Adams said he is hopeful that the olive oil operation will become further streamlined in a couple of years, when Port Freeport should have container carrier service at its Velasco Terminal container facility that is now under construction. “ARI looks forward to the completion of Velasco Terminal and the opportunity to ship by container to and from Port Freeport,” Adams said. Already, though, ARI’s Freeport presence is substantial. ARI handles 12 million hundredweights (600,000 tons) of paddy rice a year at its Port Freeport facility. Rice produced by ARI is sold in North America under brands including AA, Adolphus, Blue Ribbon, Blue Ribbon Golden, Colusa Rose, Comet, Dragon, Green Peacock,