PETALING JAYA – Malaysia will end subsidies and price controls on chicken from Wednesday.
The decision to lift the subsidies took into account the current trend of supply, and prices which have started to stabilise, said Agriculture and Food Security Minister Mohamad Sabu.
“In line with the approach of retargeting subsidies in phases, the government has agreed that subsidies and price controls for chicken only will be fully terminated starting Nov 1,” said Datuk Seri Mohamad.
“The rationale for ending subsidies in bulk for chicken is to reduce the leakage of subsidies, which at this point are also enjoyed by foreigners and high-income groups,” he said at a press conference on Monday.
The current ceiling price for a standard processed chicken is RM9.40 (S$2.70) per kg.
Mr Mohamad said the ministry would monitor chicken prices to ensure that poultry will be sold at a reasonable rate, with the cooperation of the Ministry of Domestic Trade and Cost of Living.
He said intervention measures are in place in case of a surge in chicken prices once the ceiling prices are lifted.
“Hence, the ministry is expanding the Jualan Rahmah and Madani Agro Sales across the country to supply chicken at an affordable rate,” said Mr Mohamad.
He was referring to two government programmes that were launched to alleviate the impact of the high cost of living on the people.
Jualan Rahmah offers dozens of food items, such as eggs and cooking oil, at prices lower than market rates, while the Madani Agro Sales allow farmers and fishermen to sell their products directly to consumers, in order to help regulate prices while supplementing producers’ incomes.
“We have met industry players through an engagement session on Oct 22, and they provided their commitment that the prices of chicken will not increase significantly,” said Mr Mohamad.
He also advised the public not to resort to panic buying because an increase in demand could contribute to an increase in prices.
“We will be on standby, if it is necessary, to import chicken immediately,” he said.
Mr Mohamad also announced that subsidies and price controls for grade A, B and C eggs will remain according to the existing mechanism.
He said that if the subsidies are lifted, the price of an egg will increase by around 10 sen.
The retail ceiling price for a grade A egg is 45 sen, 43 sen for grade B, and 41 sen for grade C.
“Consumers will often purchase a tray of eggs (usually containing 30 eggs) and it will mean an increase of RM3 at this time.
“We will monitor the situation and make the announcement from time to time,” Mr Mohamad said.
The government had borne the cost of RM3.8 billion in egg and chicken subsidies since February 2022.
On Oct 13, Prime Minister Anwar Ibrahim announced plans to lift subsidies for eggs and chicken as supplies had stabilised, and retail prices were falling below ceiling prices.
Malaysian research house MIDF Research said it does not expect the market price of chickens to increase substantially, according to a report by Bernama news agency.
It said the removal of price controls and subsidies would be a positive development for chicken producers.
It would give them the flexibility to adjust prices based on market supply and demand dynamics, as well as the ability to pass on increased production costs to consumers, Bernama quoted MIDF Research as saying. THE STAR/ASIA NEWS NETWORK
