Aeration in-silo dryer for grain and seed Patent Support Request Presentation Vitaliy G. Danchenko, Larysa P. Potapovych, Ronald T. Noyes +380 562 368275 vdan@ua.fm Elevator Limited Company Dniepropetrovsk

Outline Proprietary statement Market need Technology description & Advantages Experimental results Stage of development, Next steps & Costs Targeted market segment Competition & Competitive matrix Improvements achieved Patent support request Action Plan for licensing

Proprietary information statement The technology material presented is available for licensing or joint product development.

Problem Description & Market Need 40% from 40 millions tons of grain growing at Ukraine is harvested in moist state. Due to lack of drying equipment at a reasonable price and effective grain drying technologies 6 millions tons of grain is lost because of spoilage. It costs $0.8 billions for Ukrainian economics. According to statistics only 30% of grain enterprises are provided with drying capacity. Conventional drying equipment is not available for most of small and middle farms at Ukraine and others countries because of its high cost and power inputs during operation. Farmers need inexpensive and effective dryers. The potential market of the dryers at a reasonable price and operation costs with possibility to cover its cost quickly is practically unlimited in Ukraine as 6…8 millions of harvesting grain are not provided with drying equipment.

Technical Merits The proposed aeration in-silo dryer has the following advantages in comparison with thermal dryers afforded at the market: obtainable price (approximately half as much as thermal dryers prices); high quality of drying for grain and seed; possibility of earlier harvesting on 1…2 weeks; replacing expensive and faulty fuel energy carrier with economically priced fan power; environmentally appropriate and fire safety drying conditions; carefule grain finish drying after imperfect thermal drying; ease of assembling and handling; not high operation cost; quick payback (during one year) due to the obtainable price and low (10 times less in comparison with the thermal dryers) power inputs.

Description of dryer design and operations The proposed aeration dryer is designed as conventional grain silo. Its bottom can be conical or flat. A perforated multi-sectional air distributor is installed on the bottom. Ducts of gas jetting system feed the air distributor. The gas is purged through the air distributor sectional layerwise. Having processed grain the gas is removed outside the dryer through a slot gap between the roof and sidewall sheet. The dryer construction provide enriching the air feeding grain bulk with ozone which has properties of both disinfector and drying agent. To improve the air drying properties there are systems for its drying and heating. To simplify dryer assembling and operation processes it is provided with collapsible prefabrication sectional bottom.

Technological peculiarities of the offered aeration dryer in comparison with analogues Horizontal, shorter in size in comparison with vertical and less power-intensive way of gas movement using anisotropic properties of grain body resistance to air flow. Providing of moistened air removing from the dryer without its repeated contact with dry grain. The dryer design provides its rigidity both to internal loading from the grain weight ant to environmental stress that allows applying dryers with the height much more than the diameter. Opportunity of feeding any height of grain bulk with gas of identical initial characteristics with providing level-by-level adjustable on speed purge of the bulk; Exception of an opportunity for reproduction and further development of pests in moist grain and maintenance of its qualitative parameters both during drying and the subsequent storage in a dry condition. Reduction of time and labor input of bottom assembly due to use of factory manufactured section elements without application of building equipment and concrete works.

Experimental results Researches of the preparatory grain fumigation with the ozonized air are fulfilled with the positive results. Processes of the gas moving inside the aeration dryer and moisture removing are studied with help of developed calculation model. Two aeration dryer imitators of 200 kg capacity are manufactured. Equipment for creation and monitoring of necessity medium inside the dryer as well as drying equipment is prepared. The tests will be begun in November of 2006. Engineering documentation for manufacture of field aeration dryer prototype of 18 ton capacity is issued. The prototype will be manufactured and prepared for the field test in February of 2007.

The stage of development and the international patenting Dryers’ design and grain drying technologies have been studied by patent and subject literature; 16 technical solutions the closest to the proposed dryer have been selected to use as analogs and prototypes; Application materials on the invention (drawings of the dryer design, the description of its operation and the patent formula) have been prepared; The application materials on invention have been discussed preliminary with a patent agent for their completion according to the international patenting requirements and submitting to the State patent association of Ukraine.

Next Steps for Development Manufacturing the aeration dryer, its exploratory finalizing, engineering follow up, correcting make-ready and certification Presentation of the dryer full-scale prototype to managers of Ukrainian enterprises at training center of Agricultural Department in Mayskoye village, Dniepropetrovsk region, and obtaining official appreciation of the dryer for market penetration Development of presentation materials, Web-site Development of the business plan to get budgetary (innovation) financing for preproduction and dryers manufacturing by the way of componentry manufacturing at various producing plants and next assembling by Elevator Ltd staff International Patent application to take out the Patent in USA, Canada, Ukraine Cooperation with Companies which interested in the aeration dryers (GSI International, USA, Westeel, Canada, etc) to issue the license and organize joint business Exposition of the aeration dryer at Agro 2007 Exhibition (Kyev, Ukraine), Agricultural Show in Hanover (Germany) and Brno (Czechia). Making of contract for dryers manufacturing and delivery Creation of dealer system for advertising and sealing

Development Costs analytical research; Development of the aeration dryer prototype consists of the following work stages: analytical research; laboratory experiment preparing; laboratory experiment to option the aeration technology parameters; issuing of design and engineering documentation; preproduction work for new details and assembly unit; manufacturing of the prototype and purchasing equipment for the field tests; field tests of the aeration dryer; refinement of the dryer design by the test results. Total development cost for the aeration dryer prototype of 100…150 ton capacity amounts approximately 0.9 million of USD.

Commercial potential Aeration dryer has all opportunities to win at the trade market owing to high technical and economic characteristics, parameters of quality and ecological compatibility as well as replacement of expensive energy carriers in technological process of grain and seeds drying such as natural gas and mineral oil by inexpensive energy of the fan.

Targeted Market Segment The aeration dryer may be widely adopted at: Seed-farming enterprises for: carefully and pollution-free seed drying with ambient air; germinating power stimulation and increasing the crop capacity (conceivably on 10…15%) due to seed processing with ozone. Small and middle farms for:economical drying small grain batch; Economical drying (without applying of expensive fuel). Large grain enterprises for: Finish drying after incomplete thermal drying to abate power inputs; Providing possibility to begin harvesting 1…2 weeks earlier with furthering grain ripening during drying process.

Competition My competitors are manufacturers of thermal dryers GSI, MFS (USA), Westeel (Canada), Arai (Poland), Meri (Finland). Apparently from the resulted table, of eleven basic characteristics for a choice of the dryer, offered aeration one has ten superlative characteristics of higher, except for one – the speed of drying. Thermal dryers Aeration dryer High cost Price of the equipment is 3 times below than thermal dryers High power inputs Power inputs are more than 2 times below, than at thermal drying Cracking and damages of grain, caused by internal pressure Use of sparing drying and after-dying excludes damage of grain Are not economic enough at drying grain and seeds of small parties Economic at drying small parties of grain and seeds Not high quality of seeds drying High quality of grain and seeds drying Possibility of ignition at drying of olive cultures Ignition-safe conditions of drying Environmental contamination by products of energy combustion Ecological safety of drying Insufficient efficiency of drying grain after pre cleaning, for 1 – 2 weeks Efficiency of drying after pre cleaning for 1-2 weeks Complexity of installation and operation Simplicity of installation and operation High speed of drying due to high-temperature heating Speed of drying is slower than in thermal dryers Use of expensive energy resources - natural gas or diesel fuel Low-cost energy of the fan

Competitive Matrix of the proposed and known dryers Important dryer’s characteristics Proposed aeration dryer Thermal dryer of column type GSI,MFS (USA), Westeel (Canada), Arai (Poland), Meri (Finland) Thermal bunker dryer GSI and MFS (USA) Weight, tons 3.8 10.8 13.0 Dryer’s cost, $ USA 17 000 85 000 58 000 Weight of drying grain batch, tons (corn – on 15%, wheat – on 5%) 100 Drying period, hours Corn 36 Wheat 96 Corn 4.0 Wheat 15.8 Corn 5.0 Wheat 20.5 Cost of gas for drying of one batch, $ USA - Corn 18.2 Wheat 70.5 Corn 16.3 Wheat 62.5 diesel oil, $ USA Corn 25.4 Wheat 98.7 electric power, $ USA Corn 13.5 Wheat 43.3 Corn 3.2 Wheat 10.9 Corn 2.8 Wheat 9.8 Cost of total spending, $ USA Corn 21.4 Wheat 81.4 Corn 19.1 Wheat 72.3

Competitive Matrix of the proposed and known dryers (continuation) Important dryer’s characteristics Proposed aeration dryer Thermal dryer of column type GSI,MFS (USA), Westeel (Canada), Arai (Poland), Meri (Finland) Thermal bunker dryer GSI and MFS (USA) Grain drying efficiency Not enough high High Drying efficiency for small grain batch High economy Not high economy Seed drying efficiency Not high productivity High productivity

Competitive Matrix of the proposed and known dryers (continuation) Important dryer’s characteristics Proposed aeration dryer Thermal dryer of column type GSI,MFS (USA), Westeel (Canada), Arai (Poland), Meri (Finland) Thermal bunker dryer GSI and MFS (USA) Quality of marketable grain drying High Corn - high for < 25% moisture Wheat - high Quality of seed drying Not enough high Grain quality after drying and ripening Improves Doesn’t deteriorate

Competitive Matrix of the proposed and known dryers (continuation) Important dryer’s characteristics Proposed aeration dryer Thermal dryer of column type GSI,MFS (USA), Westeel (Canada), Arai (Poland), Meri (Finland) Thermal bunker dryer GSI and MFS (USA) Finishing drying of seed and grain after incomplete thermal drying Economically and rationally Doesn’t apply Ecological compatibility High Not enough high Fire safety High for any grain-crops Not enough high at drying oil-bearing crops

Reached improvements The proposed aeration dryer design is improved in comparison with the prototype and possesses 15 distinctive attributes (according to the patent formula): The improvements allow: To reduce energy expenses more than in 2 times for drying; To provide natural and ecologically pure ripening of grain and seeds; To raise operational and functional qualities; To raise a degree of factory manufacturing; To reduce the price of the equipment (in 3 … of 5 times in comparison with similar thermal dryers); To reduce influence of surrounding atmosphere on process of drying; To provide qualitative drying of the grain not dependent on height of a grain embankment; To provide use in other brunches, for example, for drying loose materials or crushed wood.

The requirement of patent support The requirement of patent financial support in the sum of $2,200.00 USD is necessary for submission of the international application. It is planning the following clauses of expenses: Patent investigations - $350 Drafting of the Patent Formula - $150 Drafting of the declaration and drawing - $150 Application submission - $50 Duty - $1500 Total - $ 2 200

Action Plan for Licensing Prepare list of competitors and companies to contact Find and assemble marketing team Develop business-plan to obtain investment Prepare promotional material Manufacture demonstrational prototype of the aeration dryer Carry out presentation of the proposed dryer for stakeholders abroad and for representatives of the foreign companies in Ukraine Prepare Partner project for development of seed aeration dryer together with US and Canadian experts Negotiate with stakeholders about creation of joint enterprises for manufacturing aeration dryers on licensing basis

V.Danchenko, L.Potapovych, +380562-368275 vdan@ua.fm Contact information V.Danchenko, L.Potapovych, +380562-368275 vdan@ua.fm Elevator Limited Company Dniepropetrovsk