KUALA LUMPUR: The government has agreed that subsidies and price controls on chicken will be discontinued from Wednesday (Nov 1), said Agriculture and Food Security Minister Datuk Seri Mohamad Sabu.

He said, however, subsidies for grade A, B and C eggs would continue according to the existing mechanism.

"The termination of subsidies for chicken is in line with the approach of retargeting subsidies in phases implemented by the government," he told a press conference here today.

He said the government has allocated a total of RM3.8 billion in subsidies to cover the costs of chicken and eggs until February this year.

"The rationale for ending subsidies in bulk for chicken is to reduce leakages of subsidies, which are also enjoyed by foreigners and high-income groups," he said.

Also present at the press conference were Deputy Agriculture and Food Security Minister Chan Foong Hin, Treasury secretary-general Datuk Johan Mahmood Merican and Domestic Trade and Cost of Living Ministry secretary-general Datuk Mohd Sayuthi Bakar.

Mohamad explained that the termination of chicken subsidies also took into account the current supply and price trends, with farm prices and production costs beginning to stabilise, leading to the current market prices being below the ceiling price.

In this regard, he said the government would ensure the sale price of chicken, once floated, remains at a reasonable rate.

"The government is expanding access to chicken supplies through continuous Agro MADANI and Rahmah Sales programmes nationwide to provide options and assurance to the people to obtain chicken at reasonable prices and below the current ceiling price.

"Through an engagement session with industry players on Oct 22, 2023, the government secured commitments from the industry to ensure that farmgate prices of chicken will not increase significantly and burden consumers," he said.

Mohamad said the Domestic Trade and Cost of Living Ministry would implement monitoring and enforcement through the Price Control and Anti-Profiteering Act 2011 to ensure there are no excessive profit-taking activities and price manipulation by irresponsible parties at the retail level.

He said the government would continue to collaborate with all stakeholders to ensure the supply and prices of chicken at the farms remain stable and not burden the people and there are no profiteering activities along the supply chain.

"The government will continue to focus on strengthening the poultry farming industry through incentives to small- and medium-sized breeders and micro-credit schemes as working capital assistance for community breeders as well as the transformation programme of open chicken coops to closed chicken coops.

"These measures will provide an improvement in terms of supply access directly from community breeders to wholesalers in the market," he said.

Meanwhile, Johan said that by ending chicken subsidies, the government could save about RM100 million a month.

When tabling the Budget 2024 on Oct 13, Prime Minister Datuk Seri Anwar Ibrahim announced that the temporary price controls for eggs and chicken will be lifted, as current trends indicate that the supply of both food items is now stable.

He said the move is to enable the local market to function freely in ensuring a sufficient supply of chicken and eggs.

Anwar also said that the floating of chicken and egg prices ensures that only eligible citizens, not foreigners or super-rich groups, benefit from the subsidies provided.

-- BERNAMA