<PAGE>

                    SECURITIES AND EXCHANGE COMMISSION
                           WASHINGTON, D.C. 20549


                                FORM 10-Q


             QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)
                  OF THE SECURITIES EXCHANGE ACT OF 1934


              For the three months ended December 31, 1995


                     Commission File Number 0-17039


                            American Rice, Inc.
           (Exact Name of Registrant as Specified in its Charter)



           Texas                                76-0231626
(State or other Jurisdiction of     (I.R.S. Employer Identification No.)
Incorporation or Organization)



       16825 Northchase, Suite 1600
             Houston, Texas                            77060
 (Address of Principal Executive Offices)           (Zip Code)


                            (713) 873-8800
                     Registrant's Telephone Number,
                          Including Area Code



Indicate by check mark whether the registrant (1) has filed all reports 
required to be filed by section 13 or 15 (d) of the Securities Exchange 
Act of 1934 during the preceding 12 months (or for such shorter period 
that the registrant was required to file such reports), and (2) has been 
subject to such filing requirements for the past 90 days. Yes [X] No [ ]

The number of shares outstanding of the registrant's common stock, 
$1 par value, as of February 6, 1996 is 2,443,699 shares
<PAGE>
PART 1 - FINANCIAL INFORMATION
Item 1.  Financial Statements

                     AMERICAN RICE, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF OPERATIONS
                           (Thousands of Dollars)
                                 (Unaudited)

                                    Three Months        Nine Months
                                Ended December 31,  Ended December 31,
                                   1995      1994      1995      1994
                                ----------------------------------------

Net sales                        $101,440  $106,330  $278,201  $290,350

Cost of sales                      93,131    96,445   250,638   260,092
                                ----------------------------------------
    Gross profit                    8,309     9,885    27,563    30,258

Selling, general and
  administrative expenses           6,158     6,123    18,003    17,004
Provision for loss on disposal
  of property (Note 4)              7,200       -       7,200       -
                                ----------------------------------------
    Operating income (loss)        (5,049)    3,762     2,360    13,254

Interest expense                    4,914     3,258    12,516     9,227
Interest income                      (642)     (172)   (1,170)     (522)
Minority interest                    (217)      (17)     (463)      (21)
Other income and expense              100      (328)      251      (170)
                                ----------------------------------------
Earnings (loss) before
  income taxes                     (9,204)    1,021    (8,774)    4,740

Provision for 
  income taxes (benefit)           (3,313)      377    (3,159)    1,754
                                ----------------------------------------
    Net earnings (loss)           ($5,891)     $644   ($5,615)   $2,986
                                ========================================
Preferred stock dividend
  requirements                      1,483     1,483     4,448     4,448
                                ----------------------------------------
Net loss applicable
  to common stock                 ($7,374)    ($839) ($10,063)  ($1,462)
                                ========================================
Loss per applicable
  common and common equivalent
  share:

  Primary                          ($3.02)    ($.34)   ($4.12)    ($.60)
                                ========================================
  Fully diluted                    ($3.02)    ($.34)   ($4.12)    ($.60)
                               ========================================= 
See Notes to Consolidated Financial Statements
Page 1<PAGE>

               AMERICAN RICE, INC. AND SUBSIDIARIES
                   CONSOLIDATED BALANCE SHEETS
                     (Thousands of Dollars)

                                             December 31,  March 31,
                                                   1995      1995
                                                --------------------
ASSETS                                          (Unaudited)

Current assets:
  Cash and cash equivalents                        $1,259    $1,864
  Accounts receivable, net                         42,319    33,423
  Inventories
    Finished goods                                 34,191    17,108
    Raw materials                                  30,695    33,097
  Prepaid expenses                                    899       793
  Deferred income taxes                             3,412     3,451
  Net assets of Houston properties 
    held for sale (Note 4)                         13,535	    -
                                                --------------------
    Total current assets                          126,310    89,736


Net assets of Houston properties held for sale        -      18,767
Other assets                                       20,843    15,710
Receivable from ERLY                               24,429    11,901
Property, plant and equipment, net                 42,673    41,386
                                                --------------------
  Total assets                                   $214,255  $177,500
                                                ====================

Continued on next page

See Notes to Consolidated Financial Statements
Page 2<PAGE>

		 AMERICAN RICE, INC. AND SUBSIDIARIES
             CONSOLIDATED BALANCE SHEETS (CONTINUED)
                     (Thousands of Dollars)

                                              December 31,  March 31,
                                                   1995      1995
                                                --------------------
                                                (Unaudited)

LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
  Notes payable                                   $35,725   $33,937
  Accounts payable and accrued expenses            39,266    34,372
  Income taxes payable to ERLY                        -       1,037
  Current portion of long-term debt                   103     6,727
                                                --------------------
    Total current liabilities                      75,094    76,073

Long-term debt                                     95,377    48,573

Deferred income taxes                               5,187     8,616

Minority interest                                     -          26

Stockholders' equity (Note 3):
  Preferred stock, $1.00 par value; 4,000,000
    shares authorized;
    Series A- 777,777 convertible shares issued
      and outstanding, liquidation preference
      of $19,989                                      778       778
    Series B- 2,800,000 convertible shares issued
      and outstanding, liquidation preference
      of $14,000                                    2,800     2,800
    Series C- 300,000 shares issued
      and outstanding, liquidation preference
      of $1,500                                       300       300
  Common stock, $1.00 par value; 10,000,000
    shares authorized; 2,443,699 shares
    issued and outstanding                          2,444     2,444
  Paid-in capital                                  25,286    25,286
  Retained earnings                                 7,737    13,352
  Cumulative foreign currency
    translation adjustments                          (748)     (748)
                                                --------------------
  Total stockholders' equity                       38,597    44,212
                                                --------------------
    Total liabilities and stockholders' equity   $214,255  $177,500
                                                ====================
See Notes to Consolidated Financial Statements
Page 3<PAGE>
                  AMERICAN RICE, INC. AND SUBSIDIARIES
                  CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (Thousands of Dollars)
                             (Unaudited)
	   	                                        Nine Months
                                                 Ended December 31,
                                                   1995      1994
OPERATING ACTIVITIES:                            ------------------
  Net earnings (loss)                             ($5,615)   $2,986
  Adjustments to reconcile net earnings to net cash
    provided by (used in) in operating activities:
    Depreciation and amortization                   4,377     4,793
    Mortgage note discount accretion                  190       -
    (Gain) loss on sales of property                  -          34
    Provision for loss on disposal	    
      of property (Note 4)                          7,200
    Deferred income taxes, net                     (3,390)    1,077
    Changes in assets and liabilities that
      provided (used) cash:
      Accounts receivable                          (8,896)   (6,717)
      Inventories                                 (14,681)   23,322
      Prepaid expenses                               (106)     (549)
      Other assets                                    128      (451)
      Receivable from ERLY                         (2,028)     (887)
      Accounts payable and accrued expenses         2,926       891
      Income taxes payable to ERLY                 (1,037)      250
                                                --------------------
  Net cash provided (used) by
    operating activities                          (20,932)   24,749
INVESTING ACTIVITIES:
  Property, plant and equipment additions          (4,390)   (2,593)
  Proceeds from sales of assets                        85        16
  Loan to ERLY                                    (10,500)      -
                                                --------------------
  Net cash used in
    investing activities                          (14,805)   (2,577)
FINANCING ACTIVITIES:
  Increase(decrease)in notes payable                1,788   (18,395)
  Proceeds from issuance of long-term debt	         1,290	      -
  Proceeds from issuance of mortgage notes         94,000       -
  Mortgage notes issuance costs                    (6,620)      -
  Repayment of long-term debt                     (55,300)   (3,908)
  Other, net                                          (26)      (21)
                                                 --------------------
Net cash provided by (used in)
  financing activities                             35,132   (22,324)
                                                 --------------------
NET DECREASE IN CASH                                 (605)     (152)
CASH:
  Beginning of the period                           1,864     1,721
                                                --------------------
  End of the period                                $1,259    $1,569
                                                ====================
See Notes to Consolidated Financial Statements
Page 4<PAGE>

<TABLE>

                           AMERICAN RICE, INC. AND SUBSIDIARIES
                     CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY
                           Nine Months Ended December 31, 1995
                                 (Thousands of Dollars)
                                      (Unaudited)
<CAPTION>

                                                                 Foreign      Total
                                            Additional           Currency    Stock -
                         Preferred  Common   Paid-in   Retained Translation  Holders'
                          Stock     Stock    Capital   Earnings Adjustments  Equity
                         --------- --------- --------- --------- --------- ---------
<S>                      <C>       <C>      <C>        <C>       <C>       <C>
Balance April 1, 1995     $3,878    $2,444   $25,286    $13,352    ($748)   $44,212

Net earnings (loss)          -         -         -       (5,615)             (5,615)
                         --------- --------- --------- --------- --------- ---------
Balance
  December 31, 1995       $3,878    $2,444   $25,286     $7,737    ($748)   $38,597
                         ========= ========= ========= ========= ========= =========

<FN>
See Notes to Consolidated Financial Statements
</TABLE>
Page 5<PAGE>

AMERICAN RICE, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unaudited)

1.  Basis of Presentation:

The consolidated financial statements presented herein at December 31, 
1995 and for each of the three and nine month periods ended December 31, 
1995 and 1994 are unaudited; however, all adjustments which are, in the 
opinion of management necessary for a fair presentation of the financial 
position, results of operations and cash flows for the periods covered 
have been made and are of a normal, recurring nature.  The results of 
the interim periods are not necessarily indicative of results for the 
full year.  The consolidated balance sheet at March 31, 1995 is derived 
from the March 31, 1995 audited consolidated financial statements but 
does not include all disclosures required by generally accepted 
accounting principles. Although management believes the disclosures are 
adequate, certain information and disclosures normally included in the 
notes to the financial statements has been condensed or omitted as 
permitted by the rules and regulations of the Securities and Exchange 
Commission.  These financial statements should be read in conjunction 
with the audited financial statements and notes thereto included in 
American Rice, Inc.'s ("ARI") Annual Report on Form 10-K for the fiscal 
year ended March 31, 1995.

2. Notes Payable and Long-Term Debt

In a public offering completed on August 24, 1995, ARI issued 
$100 million in principal amount of 13.0% mortgage notes due 2002 (the 
"Notes").  Portions of the net proceeds of $94 million were used to 
repay $53.8 million of existing term debt, to make a $10.5 million 15% 
loan to ERLY Industries Inc. due 2002, and to reduce borrowings 
outstanding under the $47.5 million revolving credit loan.  The Notes 
were issued pursuant to an indenture between ARI and U.S. Trust Company 
of Texas, N.A. (the "Indenture").

The Notes provide for interest payments semiannually, mature on July 31, 
2002, and are non callable by ARI prior to July 31, 1999, after which 
date the Notes are callable at the option of ARI, in whole or in part, 
at any time upon not less than 30 nor more than 60 days notice, at 
107.0% of the principal amount, declining ratably to par on or after 
July 31, 2001.  Except under certain changes of control, upon 
remarketing of the industrial revenue bonds, or asset sales, as defined 
in the Indenture, ARI is not required to make mandatory redemption 
payments on the Notes.  The Notes accrue fixed interest at an annual 
rate of 13.0%, an effective yield rate of 14.4%. 

In addition to fixed interest, the Notes bear contingent interest of 
4.0% of consolidated cash flow (as defined) up to a limit of $40.0 
million of consolidated cash flow during the fiscal year in which such 
interest accrues. Contingent interest accrues in each semiannual period 
(as defined) in which consolidated cash flow in such period and the 
immediately preceding semiannual period is equal to or greater than 
Page 6<PAGE>
$20.0 million.  Contingent interest is payable semiannually, but ARI may 
elect to defer all or a portion of any such payment to the extent that 
(a) the payment of such portion of contingent interest will cause ARI's 
adjusted fixed charge coverage ratio (as defined) for the two 
consecutive applicable semiannual periods to be less than 2.0:1 and (b) 
the principal of the Notes corresponding to such contingent interest has 
not then matured and become due and payable.

The Notes are secured by (a) a first or second priority security 
interest in substantially all of ARI's property, plant and equipment 
(including related leasehold interests), (b) a first priority security 
interest in 39 acres of land in Houston, Texas held for sale, (c) a 
pledge agreement creating first priority security interests in the 
capital stock of ARI held by ERLY (other than 200,000 shares of ARI's 
Series B preferred stock pledged to the holders of ARI's Series 
C preferred stock), (d) the ERLY notes receivable and (e) a security 
agreement creating a first priority security interest in all registered 
U.S. trademarks and a security interest in all other registered 
trademarks owned or licensed by ARI.

The Notes rank senior in right of payment to all subordinated 
indebtedness and pari passu in right of payment with all existing and 
future senior indebtedness of ARI, including borrowings under the 
revolving credit loan.  The Indenture includes covenants that in certain 
instances restrict, among other things, (a) the payment of dividends, 
(b) the redemption of equity interests of ARI, (c) the payment on or 
redemption of indebtedness subordinate to the Notes, (d) certain 
investments (as defined), (e) the incurrence of certain indebtedness and 
issuance of preferred stock, (f) certain transactions with affiliates 
and (g) certain mergers, consolidations or sales of assets.  In 
addition, the Indenture contains certain limitations on capital 
expenditures, operating lease obligations and rice contract polices and 
procedures. The Indenture and the revolving credit loan described below 
contain cross default provisions.

The revolving credit loan, which was amended effective June 30, 1995, 
bears interest at the prime rate of interest plus 0.5% and will mature 
on May 24, 1996.  Funds available for borrowing under this revolving 
credit loan at any time may not exceed 85% of eligible accounts 
receivable (or 90% of accounts receivable backed by acceptable letters 
of credit from customers) and 70% of eligible inventory.  The revolving 
credit loan is primarily collateralized by a first priority security 
interest in trade receivables, inventory, and certain key man life 
insurance. At December 31, 1995, the outstanding balance on this loan 
was $32 million and on January 1, 1996 the borrowing base under the loan 
was $47.1 million.  During the nine months ended December 31, 1995, 
ARI's maximum borrowing under the loan was $33.2 million
Page 7<PAGE>
Long-term debt consisted of the following:

                                          December 31,  March 31,
                                              1995         1995
                                            ---------------------
     13.0% Mortgage Notes                   $100,000
        Less unamortized discount             (5,810)
     Chase Manhattan Bank                                 $23,755
     Internationale Nederland Bank, N.V.                   23,755
     Texas Commerce Bank                                    6,842
     Other notes                               1,290          948
                                            ---------------------
        Total                                 95,480       55,300

     Less current maturities                    (103)      (6,727)
                                            ---------------------
        Total long-term debt                $ 95,377      $48,573
                                            =====================


3.  Statement of Cash Flows
   
Borrowings under the revolving credit line in the nine months ended 
December 31, 1995 and 1994 totaled $289 million and $248 million, 
respectively, and repayments during the same periods totaled $287     
million and $266 million, respectively.  ARI made cash payments for 
interest and financing fees of approximately $6.2 million and $6.8 
million during the nine months ended December 31, 1995 and 1994, 
respectively.  ARI paid $1.3 million and $427 thousand for federal and 
state income taxes during the nine months ended December 31, 1995 and 
1994, respectively.

4. Provision for Loss on Disposal of Properties

ARI has entered into agreements to sell its properties in Houston, 
Texas. The terms of the agreements require that certain conditions be 
met prior to consummation of the sales including demolition of 
structures and updated environmental studies. The net realizable value 
of the transactions is expected to approximate $11.6 million. 
Accordingly, the previous carrying value of the properties of $18.8 
million is being reduced to its approximate net realizable value by a 
non-recurring charge of $7.2 million in the three months ended December 
31, 1995. The transactions are expected to be consummated in the third
quarter of calendar 1996.
Page 8<PAGE>

Item 2. Management's Discussion and Analysis of Financial Condition and 
Results of Operations

Results Of Operations

The Company purchases and processes rough rice into branded and 
commodity rice for sale in both international and domestic markets. 
Demand for branded rice products is relatively constant and margins are 
typically higher than those for commodity rice products. Demand for 
commodity rice products is relatively constant globally, but demand for 
U.S. grown commodity rice is dependent upon supply and its cost relative 
to other sources of supply. Supply and costs for both branded and 
commodity products depend on many factors including governmental 
actions, crop yields and weather, and such factors can persist through 
one or more fiscal years.

Three Months Ended December 31, 1995 Compared to 
Three Months Ended December 31, 1994

Net Sales. Net sales decreased $4.9 million, or 4.6%, from $106.3 
million in fiscal 1995 to $101.4 million in fiscal 1996. Export sales of 
$65.5 million declined $7.0 million, or 9.7%, from the fiscal 1994 
period while sales in the U.S. and Canada increased $2.1 million, or 
6.3% to $35.9 million. 

Export sales declined due to lower volume partially offset by higher 
average prices. Total export sales volume declined approximately 
1.7 million equivalent rough rice hundredweight's or 26%, accounting for 
an $18.7 million sales decrease. Average export prices increased 
approximately 22%, accounting for $11.7 million in sales increases. 
Export volume was lower primarily due to decreased volume in the Middle 
East and the Caribbean as a result of generally weak demand for 
unbranded product. Partially offsetting these declines, sales to Japan 
were higher, although shipment levels in the quarter were not as high as 
expected due to port congestion and unfavorable weather conditions. 
Domestic sales were higher as a result of higher average prices 
partially offset by lower volume.

Gross Profit. Gross profit was 8% of sales for the fiscal 1996 quarter 
and 9% for the same period in 1995. Gross profit declined $1.6 million, 
or 15.9%, from $9.9 million in the fiscal 1995 third quarter to $8.3 
million in fiscal 1996, due primarily to declines in gross profit from 
sales in the Western Hemisphere and Middle East as a result of lower 
volume, partially offset by higher gross profits from sales to Japan.

Provision for Loss on Disposal of Properties. ARI has entered into 
agreements to sell its properties in Houston, Texas. The terms of the 
agreements require that certain conditions be met prior to consummation 
of the sales including demolition of structures and updated 
environmental studies. The net realizable value of the transactions is 
expected to approximate $11.6 million. Accordingly, the previous 
carrying value of the properties of $18.8 million is being reduced to 
Page 9<PAGE>
its approximate net realizable value by a non-recurring charge of $7.2 
million in the three months ended December 31, 1995. The transactions 
are expected to be consummated in the third quarter of calendar 1996.

Management believes it is in the best interest of ARI to proceed with 
disposition of the property in an expeditious manner due to the 
improvement in liquidity it will provide and to the Note covenant 
requiring sale of the property within eighteen months of the date of 
issuance of the notes to avoid certain penalties. Management expects to 
invest the proceeds in other projects.

Interest. Interest expense increased $1.6 million from $3.3 million in 
the fiscal 1995 period to $4.9 million in fiscal 1996 due to higher 
average balances outstanding and higher average interest rates. Interest 
expense in both periods includes amortization of capitalized debt 
issuance costs. Interest expense in the fiscal 1996 period includes 
accretion of the $6 million original issue discount on the Notes. 
Partially offsetting the increase in interest expense, interest income 
increased $470 thousand to $642 thousand due primarily to the $10.5 
million loan to ERLY (see Note 2 of Notes to Consolidated Financial 
Statements).

Nine Months Ended December 31, 1995 Compared to 
Nine Months Ended December 31, 1994

Net Sales. Net sales declined $12.1 million, or 4.2%, from $290.4 
million in fiscal 1995 to $278.2 million in fiscal 1996. The decline in 
sales was composed of $14.7 million in decreased export sales partially 
offset by $2.6 million from increased sales in the U.S. and Canada.

Export sales declined due to lower volume partially offset by higher 
average prices. Total export sales volume declined approximately 
3.4 million equivalent rough rice hundredweight's or 18%, accounting for 
a $34.5 million sales decline. Average export prices increased 
approximately 12.5%, accounting for $19.8 million in sales increases. 
Export volume was lower primarily due to lower sales to Japan and the 
Caribbean partially offset by higher sales to the Middle East. Domestic 
sales were higher as a result of higher volume partially offset by lower 
average prices.

Gross Profit. Gross profit was 10% of sales for both the fiscal 1995 and 
1996 periods. Gross profit declined $2.7 million, or 8.9%, from 
$30.3 million in fiscal 1995 to $27.6 million in fiscal 1996, due 
primarily to lower sales to Japan partially offset by increases in gross 
profit from Western Hemisphere and Middle East sales.

Selling, General and Administrative Expenses. Selling, general and 
administrative expenses increased $1.0 million, or 5.9% from 
$17.0 million in fiscal 1995 to $18.0 million in fiscal 1996. As a 
percentage of net sales, selling, general and administrative expenses 
increased from 5.9% in 1995 to 6.5% in fiscal 1996 due primarily to a 
higher proportion of branded sales in 1996.
Page 10<PAGE>
Interest. Interest Expense increased $3.3 million from $9.2 million in 
fiscal 1995 to $12.5 million in fiscal 1996 due to higher average 
balances outstanding and higher average interest rates. Interest income 
increased $648 thousand due primarily to the $10.5 million loan to ERLY.

Liquidity and Capital Resources

ARI requires liquidity and capital primarily for the purchase of rough 
rice and to invest in property, plant and equipment necessary to support 
operations. Historically, ARI has financed both working capital and 
capital expenditures through internally generated funds and by funds 
provided by credit lines.

Comparing December 31, 1995 to March 31, 1995 balances ARI accounts 
receivable increased $8.9 million to $42.3 million and inventories 
increased $14.7 million to $64.9 million. The accounts receivable 
increase is primarily attributable to the beginning of the Japan sales.
Inventories increased due to a variety of factors which included 
generally higher price levels and higher inventories in Vietnam and for 
Saudi Arabia business.

Historically, the rice ARI sold in Saudi Arabia was processed and packed 
in the United States and shipped to Saudi Arabia. In October 1994, ARI 
entered into an agreement with Rice Milling and Trading, Ltd., Inc. 
("RMT"), an operator of a receiving, processing, storage and bagging 
facility in Jeddah, Saudi Arabia, to receive bulk rice from ARI and pack 
rice on a exclusive basis and under strict ARI quality supervision. By 
shipping rice in bulk to RMT, ARI reduces vessel loading and freight 
costs. Shipments to RMT under this agreement began in June 1995, and 
shipments to Saudi merchants from the RMT facility began in October 
1995. Attendant with the change from processing in the United States to 
processing in the Saudi Arabia, ARI experienced some inventory 
increases.

In a public offering completed on August 24, 1995, ARI issued 
$100 million in principal amount of 13.0% mortgage notes due 2002 (the 
"Notes").  Portions of the net proceeds of $94 million were used to 
repay $53.8 million of existing term debt, to make a $10.5 million 15% 
loan to ERLY due 2002, and to reduce borrowings outstanding under the 
$47.5 million revolving credit loan.

The Notes provide for interest payments semiannually, accruing fixed 
interest at an annual rate of 13.0%, an effective yield rate of 14.4%. 

In addition to fixed interest, the Notes bear contingent interest of 
4.0% of consolidated cash flow (as defined) up to a limit of $40.0 
million of consolidated cash flow during the fiscal year in which such 
interest accrues. Contingent interest accrues in each semiannual period 
(as defined) in which consolidated cash flow in such period and the 
immediately preceding semiannual period is equal to or greater than 
$20.0 million.  Contingent interest is payable semiannually, but ARI may 
elect to defer all or a portion of any such payment to the extent that 
(a) the payment of such portion of contingent interest will cause ARI's 
adjusted fixed charge coverage ratio (as defined) for the two 
page 11<PAGE>
consecutive applicable semiannual periods to be less than 2.0:1 and (b) 
the principal of the Notes corresponding to such contingent interest has 
not then matured and become due and payable. As of December 31, 1995, 
the total contingent interest accrued was $308,633. Relevant details are 
as follows:
<TABLE>
<CAPTION>
                                
                               December 31, 1994       June 30, 1995     December 31, 1995
                                ----------------    -----------------    -----------------
<S>                             <C>                 <C>                  <C>                
   Consolidated Cash Flow:
       Year Ended                   $24,329,000          $20,631,000          $18,564,000
       Semiannual Period Ended       $9,897,000          $10,735,000           $7,830,000
   Contingent Interest Accrued
       as of December 31, 1995: 
          Amount Pertaining to 
             Semiannual Period 
                  Ended                 $17,595             $291,038                 -0-
          Accrual Dates              August 24 -        September 1 -
                                  August 31, 1995     December 31, 1995
   Contingent Interest Paid
       as of December 31, 1995:             -0-                  -0-                 -0-
   Adjusted Fixed Cost Coverage
       Ratio for Year Ended                                 1.9 to 1            1.4 to 1

</TABLE> 

For the three month periods ended December 31, 1995 and September 30, 
1995, respectively, the consolidated cash flow was $3,071,000 and 
$4,759,000, respectively.

The revolving credit loan, which was amended effective June 30, 1995, 
bears interest at the prime rate of interest plus 0.5% and will mature 
on May 24, 1996.  Funds available for borrowing under this revolving 
credit loan at any time may not exceed 85% of eligible accounts 
receivable (or 90% of accounts receivable backed by acceptable letters 
of credit from customers) and 70% of eligible inventory.  The revolving 
credit loan is primarily collateralized by a first priority security 
interest in trade receivables, inventory, and certain key man life 
insurance. At December 31, 1995, the outstanding balance on this loan 
was $32 million and on January 1, 1996 the borrowing base under the loan 
was $47.1 million.  During the nine months ended December 31, 1995, 
ARI's maximum borrowing under the loan was $33.2 million.
                   
Capital expenditures, limited by the Note Indenture to $5.5 million per 
fiscal year (with carryover provisions as defined) if the consolidated 
cash flow (as defined) does not exceed $30 million per year, were $4.4 
million and $2.6 million for the nine months ended December 31, 1995 and 
1994, respectively. Management anticipates the $5.5 million limitation 
will allow for maintenance of existing facilities and will also support 
limited growth.

ARI's Preferred B and C stock carries annual cumulative, non-
participating dividends of $5.2 million and $750 thousand respectively.  
No dividends have been declared or paid as of December 31, 1995.  As of 
December 31, 1995, the Preferred B dividends accumulated but not 
Page 12<PAGE>
declared are $13.4 million and the Preferred C dividends accumulated but 
not declared are $1.9 million.

PART II - OTHER INFORMATION

Item 1.   Legal Proceedings - none

Item 6.   Exhibits and Reports on Form 8-K

(a)  Exhibits

11.1  Computation of Earnings Per Share.

27    Financial Data Schedule

(b)  During the quarter ended December 31, 1995, Registrant did not file 
any Form 8-K Reports.

Pursuant to the requirements of the Securities Exchange Act of 1934, the 
registrant has duly caused this report to be signed on its behalf by the 
undersigned thereunto duly authorized.



                                           American Rice, Inc.
                                           -------------------
                                               Registrant


                                             
                                           Joseph E. Westover
                                       ---------------------------
                                       Vice-President / Controller
Page 13<PAGE>
								
Exhibit 11.1

                  AMERICAN RICE, INC. AND SUBSIDIARIES
                   COMPUTATION OF EARNINGS PER SHARE
              (Thousands of Dollars Except Per Share Data)


                                Three Months         Nine Months
                             Ended December 31,   Ended December 31,
                              1995       1994       1995       1994
                           --------------------------------------------

PRIMARY EARNINGS (LOSS) PER SHARE

  Net earnings (loss)         ($5,891)      $644    ($5,615)    $2,986

  Less dividends on preferred stock:
    Series B                   (1,295)    (1,295)    (3,885)    (3,885)
    Series C                     (188)      (188)      (563)      (563)
                           --------------------------------------------
                               (1,483)    (1,483)    (4,448)    (4,448)
                           --------------------------------------------
  Loss applicable to
    common stock              ($7,374)     ($839)  ($10,063)   ($1,462)
                           ============================================
  Average common and common
    equivalent shares outstanding:
    Common                      2,444      2,444      2,444      2,444
    Preferred Series A              -          -          -          -
                           --------------------------------------------
                                2,444      2,444      2,444      2,444
                           ============================================

  Loss per share
   applicable to common stock  ($3.02)     ($.34)    ($4.12)     ($.60)
                           ============================================

Continued on next page
<PAGE>

Exhibit 11.1 (Continued)

                  AMERICAN RICE, INC. AND SUBSIDIARIES
                   COMPUTATION OF EARNINGS PER SHARE
              (Thousands of Dollars Except Per Share Data)

                                Three Months          Nine Months
                             Ended December 31,   Ended December 31,
                              1995       1994       1995       1994 
                           --------------------------------------------

FULLY DILUTED EARNINGS PER SHARE *


  Net earnings (loss)         ($5,891)      $644    ($5,615)     $2,986


  Less dividends on preferred stock:
    Series C                     (188)      (188)      (563)      (563)
                           --------------------------------------------
  Earnings (loss) applicable to
    common stock              ($6,079)      $456    ($6,178)    $2,423
                           ============================================
  Average common and common
    equivalent shares outstanding:
    Common                      2,444      2,444      2,444      2,444
    Preferred Series A            778        778        778        778
    Preferred Series B          5,600      5,600      5,600      5,600
                           --------------------------------------------
                                8,822      8,822      8,822      8,822
                           ============================================

    Earnings (loss) per share
     applicable to common stock ($.69)      $.05      ($.70)      $.27
                           ============================================


    * This calculation is presented in accordance with Regulation
    S-K item 601(b)(11) although it is contrary to paragraphs 14, 30,
    and 40 of APB Opinion No. 15 because it produces an antidilutive
    result. The Opinion provides that a computation on a fully
    diluted basis which results in an improvement in earnings
    per share when compared to primary earnings per share 
    (antidilution) not be taken into account. Therefore fully diluted
    earnings per share reported on the income statement are the same
    as primary earnings per share.