Sumitomo Corporation Enters Capital and Business Alliance With NEWGREEN To Expand Distribution of Rice Cultivated With Reduced Greenhouse Gas Emissions

Sumitomo Corporation (Head Office: Chiyoda-ku, Tokyo; Representative Director, President and Chief Executive Officer: Shingo Ueno), together with its wholly owned subsidiary SC Foods Co., Ltd. (Head Office: Chiyoda-ku, Tokyo; President: Seiji Okamoto) and Sumitomo Corporation Tohoku Co., Ltd. (Head Office: Sendai City, Miyagi Prefecture; President and CEO: Seiji Takano; hereinafter "Sumitomo Corporation Tohoku"), collectively referred to as the "Sumitomo Corporation Group," has made an equity investment in NEWGREEN Inc. (Head Office: Tokyo; Co-CEOs: Daisuke Yamanaka and Hiroki Nakajo; hereinafter "NEWGREEN"). NEWGREEN is a startup that supports environmentally friendly rice cultivation by promoting sustainable farming practices and providing production support to rice growers. Through this partnership, the Sumitomo Corporation Group and NEWGREEN will work together to promote and expand rice cultivation methods that reduce environmental impact.

Background and Purpose of the Investment

In Japan, the agricultural sector accounts for roughly 80% of total methane emissions, a higher proportion than in the United States or Europe. Rice cultivation alone is responsible for about 40% of Japan's total methane emissions, making it a significant source. Methane has approximately 25 times the greenhouse effect of CO₂ and the Japanese government is promoting diverse initiatives to reduce emissions from rice farming, including introducing new technologies, providing subsidies and creating carbon credits. Recognizing these challenges, NEWGREEN is working to expand the use of water-saving cultivation methods, which have the potential to reduce methane emissions from rice cultivation by around 70% (*2).
Recognizing NEWGREEN's extensive network of producers and the high potential of these cultivation methods to reduce emissions, the Sumitomo Corporation Group entered into this capital and business alliance to accelerate the spread of water-saving rice cultivation.

The Sumitomo Corporation Group's Rice Distribution Initiatives

Since its establishment in 1989, SC Foods has been a trusted company in the food industry, gathering and analyzing global food products and market information to provide optimal solutions that meet customers' real needs and procurement environments. In the rice business, the company leverages its strong relationships with leading domestic producers and multiple overseas suppliers to offer a wide range of products and services to end users.
Since 2023, Sumitomo Corporation Tohoku has been working with NEWGREEN to promote the distribution of rice cultivated with reduced greenhouse gas emissions. In 2024, the company began providing samples of rice produced using water-saving cultivation methods for food processing manufacturers.

Moving forward, the Sumitomo Corporation Group will continue working with NEWGREEN to strengthen the distribution and sales of rice produced using environmentally friendly methods, contributing to the realization of sustainable agriculture and a stable food supply.

*1 Water-saving cultivation: A production method in which rice seeds are sown directly into dry fields without flooding. The method involves minimal water management and is gaining attention as a farming practice that can simultaneously reduce methane emissions, lower costs and save labor.
*2 Based on verification trials conducted by NEWGREEN in Saitama Prefecture using Intergovernmental Panel on Climate Change (IPCC) emission factors, water-saving cultivation has the potential to reduce methane emissions by approximately 70% compared with conventional flooded rice paddies.

Overview of NEWGREEN Inc.

Company name	:	NEWGREEN Inc.
Representatives	:	Daisuke Yamanaka, Hiroki Nakajo
Head Office	:	Nakacho, Koganei City, Tokyo
Established	:	November 2019
Business activities	:	Development of agricultural robots; development and sale of organic rice and processed foods; development and sale of agricultural materials

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