Ask a miller what they sell and they'll say "rice." But by weight, nearly a third of every quintal of paddy leaves the mill as something else — bran, husk, and broken rice. How well you track and sell those by-products often decides whether a milling run is profitable. This guide covers what the by-products are, how to account for them, and how to work out your true cost per ton.
The main by-products
| By-product | Typical share of paddy | Where it's sold |
|---|---|---|
| Head rice | 60–66% | Your primary product |
| Broken rice | ~5–10% | Lower-priced rice; food, brewing, feed |
| Bran | ~8% | Rice-bran oil extraction, cattle feed |
| Husk | ~20% | Boiler fuel, briquettes, board |
(Exact proportions depend on paddy variety, moisture and machine setup — see our yield & recovery guide for how these are measured.)
Account for by-products as separate stock and sales
The single biggest mistake is treating by-products as an afterthought. Each one should be:
- Booked as its own inventory item, in its own unit (bran and husk by weight; broken rice by grade/bag), the moment a milling batch completes.
- Sold and invoiced separately, with its own price and GST treatment, so revenue is visible per by-product.
- Reconciled against the batch — paddy in should equal head rice + broken + bran + husk + loss. If it doesn't, you have leakage.
When a milling batch is completed properly, the paddy is consumed and head rice plus every by-product is received into stock in one step — so nothing is left uncounted.
Working out true cost per ton (or per bag)
Profit per ton isn't just paddy cost minus rice price. Your real cost of production includes:
- Paddy cost — the purchase price, after quality/moisture (butta) deductions.
- Processing cost — power, labour, and transport attributable to the run.
- Less by-product income — bran, husk and broken sales offset the cost of producing head rice.
Net cost of head rice = (paddy cost + processing cost) − (bran + husk + broken income), spread over head-rice output → cost per ton/bag.
Two mills with identical paddy cost and rice price can have very different profit — the difference is usually how completely they capture and sell by-products, and how accurately they load processing cost onto each batch.
Why a spreadsheet struggles here
By-product accounting touches production, inventory, sales, and costing at once. In spreadsheets these live in separate files that never quite reconcile, and broken-rice grades or bran lots quietly go missing. A rice-mill ERP ties the milling batch to the stock and the sale, so every by-product is booked, valued, and reconciled automatically.
See true profit per ton, by-products included
Millingo books bran, husk, and broken rice as separate stock at batch completion, invoices each with its own price and GST, and computes cost per ton/bag after by-product income — so you know which lots actually made money. Explore Millingo → or get a free consultation.
Frequently asked questions
What are the main by-products of rice milling?
Bran (~8% of paddy, for oil and feed), husk (~20%, used as fuel), and broken rice (the non-head portion of milled rice, sold below head rice).
Why is by-product accounting important?
By-products are a large share of paddy weight and a real revenue stream. Booked as separate stock and sales, they reveal true profit per ton; ignored, they leave money uncounted or unsold.
How do I calculate cost per ton of rice?
Add paddy cost (after butta) and processing cost (power, labour, transport), subtract by-product income (bran, husk, broken), then divide by head-rice output to get net cost per ton or bag.