Japan's Sumitomo joins US project to bury carbon in form of rice hulls

Trading house invests in startup Graphyte, aiming to bring climate friendly tech to Asia

By Kento Hirashima, Nikkei Asia

Japanese trading house Sumitomo Corp. has invested in a U.S. carbon dioxide removal project run by American startup Graphyte that takes carbon out of the atmosphere by burying rice hulls.

Sumitomo acquired a 49% stake in the Graphyte subsidiary operating the project in the U.S. state of Arkansas. The value of the interest is estimated in the billions of yen (1 billion yen equals $6.25 million).

Rice plants absorb carbon from the atmosphere. By blocking that carbon from returning to the atmosphere by preventing rice hulls from decomposing and burying them instead, carbon credits can be earned and sold. Sumitomo plans to bring this business to Japan and other parts of Asia, where rice farming is more widespread.

When rice hulls decompose, microbes produce carbon dioxide that is released into the atmosphere. The Arkansas project collects waste hulls from rice milling facilities, then dries the biomass to deactivate the microbes.

The dried hulls are formed into bricks to be buried underground. To prevent decomposition by microbes from the soil, the bricks are encapsulated in a special film.

Graphyte, founded in 2023, launched the carbon removal project in 2024. The facility can remove 15,000 metric tons of carbon yearly.

Bringing Sumitomo on board will increase the annual removal volume to 50,000 tons. Each brick of dried rice hulls removes 1.8 kilograms of carbon dioxide, but the operation will switch to a process that removes 2 tons per unit of biomass.

Read more in Nikkei Asia.