A bloated granular clay product is manufactured by heating clay in a first step from atmospheric temperature to 300*-600* C. during a long period of time whereafter the clay now forming granules in a second step is heated to 1,150*-1,175* C. in a relatively short period of time i.e., about 15 - 30 minutes. The heating is effected in a rotary kiln having a drying section and a burning section. The first heating step is provided in the drying section and the second heating step takes place in a transition zone between the two sections. To ensure the quick heating in said second step there is provided heat transfer means in the transition zone.