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How is laterite prepared before it is sold?

Here in Hawaii, we have laterite right in the ground.  But before I try
it, I would like to know if companies such as Dupla prepare the laterite
before packaging it.  In other words, do they dry it out in the sun, or
do they bake it in an oven, or maybe mix it with water and strain the
resulting slurry, then dry it out?  I have never used any laterite,
packaged or otherwise, but am wondering if the packaged stuff is somehow
treated to reduce clouding of the water with the particles of clay.  Why
do I think it might cloud the water?  Well, looking at the ocean near
the outlet of a storm drain after a heavy rain, the water is quite red,
and so I'm guessing something similar might happen in an aquarium
(although to a lesser degree with plain gravel covering the laterite).

Wade Shimoda