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Rice cartels control 60% of rice production, affecting supply, say groups

Rice millers, farmers say four to five major companies wield considerable influence in setting the prices for padi, rice, and padi seed suppliers.

About 71,000 farmers under the Muda Agricultural Development Authority face losses of up to RM40 million per season due to the delay in cultivating their fields because of a shortage of padi seeds, according to Utusan.

PETALING JAYA: Rice cartels have been accused of controlling over 60% of the country’s rice production, causing issues with rice seedlings and the supply of rice.

The Coalition of Rice Millers Malaysia chairman Marzukhi Othman claimed that four to five major companies are involved with controlling padi mills, which includes seed production, Utusan Malaysia reported.

He also claimed that these cartels wield considerable influence in setting the prices for padi, rice, and padi seed suppliers, and they have also disregarded government directives at times.

“They have essentially been shaping the direction of the country’s padi industry,” Marzukhi was quoted as saying.

“The existing system needs to be changed by issuing only one licence to them, and forcing them to choose between a padi mill licence and a seed production licence.”

The Malay-language daily previously reported that about 71,000 farmers under the Muda Agricultural Development Authority (Mada) face losses of up to RM40 million per season when they delayed cultivating their fields due to a shortage of padi seeds.

Additional reports claimed that these cartels were selling local rice at an inflated price of RM3.40 per kg, in violation of the government-controlled price of RM2.60 per kg.

Marzukhi also suggested granting the right to produce and license padi seeds to government organisations such as the National Farmers Organisation (Nafas) and the Farmers’ Organisation Authority (LPP).

“These appointed entities should only supply seeds to the respective farmers’ organisations in the various districts for distribution to local farmers. Additionally, the government is also urged to provide seeds 30 days earlier than the scheduled padi planting date to avoid problems for farmers later on,” he said, according to Utusan.

“To counter rice (price) manipulation, the government should also establish a single rice grade without the need for import or local labels.”

Similarly, Suara Tani Malaysia chairman Shazwan Suban claimed that there are existing cartels, especially involving large companies or mills.

“They usually control the supply of padi seeds. Each season sees a delay in supply, accompanied by issues related to seed prices,” he said, adding that this creates undue pressure on the farmers.

To address this problem, he advocated for government intervention by taking over the production and supply of padi seeds.

https://www.freemalaysiatoday.com/category/nation/2024/01/04/rice-cartels-control-60-of-rice-production-affecting-supply-say-groups/ QR Code

Published Date: January 4, 2024

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