Chicken price floated, egg subsidies remain

Chicken prices will be floated beginning Nov 1 as Putrajaya announced this morning that it is officially ending government subsidies and price control for the poultry product.

However, the move, which is part of Putrajaya's plan to implement a targeted subsidies system, will not involve chicken eggs at this juncture.

Agriculture and Food Security Minister Mohamad Sabu said the government is continuing its subsidies and price control for chicken eggs (Grades A, B and C) using existing mechanisms.

"In line with the targeted subsidies approach, the government has agreed to end subsidies and price control for chicken beginning Nov 1.

"Subsidies for chicken eggs of Grades A, B and C will be continued under the current (subsidies) mechanism," he said in a statement this morning.

According to Mohamad, the government has spent RM3.8 billion on chicken and egg subsidies since February last year.

The decision to end chicken subsidies and price control was to plug leakages, he said, as the rich and foreigners also get the subsidies under current mechanisms.

"The move to end subsidies for chicken has also taken into account the current trend and situation, where chicken supply, wholesale price and production costs are stabilising. This has led to the current market price decreasing to below the ceiling.

"In this regard, the government will ensure that the floating selling price of chicken will continue to be within a reasonable rate.

"The government will also provide better access to chicken supply through 'Jualan Agro Madani' and 'Jualan Rahmah' initiatives, which will be held continuously across the country so the rakyat can buy chicken at affordable and below ceiling price," Mohamad said.

In order to ensure that the market price for chicken does not skyrocket, the minister said industry players have given their commitment not to increase prices to the extent of burdening consumers.

On top of this, Mohamad said, the Domestic Trade and Cost of Living Ministry will monitor the market to ensure sellers do not take advantage of the move by manipulating prices and committing profiteering.

"Should there be a sudden increase in chicken price due to low supply, the government is ready to acquire additional supply from overseas.

"The government will also continue to cooperate with all parties to ensure stability of price and supply at chicken farms, and ensure no profiteering activity happens along the supply chain."

In February this year, Mohamad said the government would review the need to continue providing subsidies to chicken breeders and egg producers in June.

“By June, we will conduct a study on whether to continue with the subsidy or other methods to ensure that the price of the raw material is stable again.

“That is what we are looking into. If it is stable, what is the need to continue with the subsidy... the money (subsidy) can instead be channelled to other places that are more in need,” he reportedly told a press conference.

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