Paddy: Staple food but not stable in Sabah

SABAH is always at the paradox of development. The state is rich with resources and huge land size but poor in many aspects. Sabah has huge land size for agriculture cultivation, particularly for paddy production but unable to attain self-sufficient level for domestic consumption. Undoubtedly rice is Malaysian staple food, but the supply is unstable. Before COVID-19 we could import to offset our shortage of supply from country like Thailand, Myanmar, Indonesia but recent crisis has taught us that depending on other countries to supply for staple food is not really a good policy choice. The pandemic-led-crisis has manifested our fundamental problem, rice is insufficient, especially limited rice production by exporting country due to lockdown and the priority is to meet the domestic demand. This gives rise to food security problem. As the saying goes, no crisis should be left into waste, the recent crisis should be eye-opener for policymakers to start thinking how Sabah can be self-sufficient when it comes to rice production.

Sabah is one of the top four contributors to the nation’s GDP in agriculture sector, hovering around 15 to 16 percent for the past decades and this sector is the third largest in Sabah’s GDP which worth RM13 billion. Agriculture sector employs more than 180,000 people and engage with large numbers of informal workers. Though the contribution is significant but the focus on agriculture in Sabah mainly industrial commodities, particularly oil palms, rubber, among others. Oil palm plantation palm is the most widely cultivated crop, covering a total area of 1,435,320 hectares (88.6 percent), rubber 87,480 hectares (5.4 percent), cocoa 6,966 hectares (0.43 percent), coconut 16,686 hectares (1.03 percent). The Industrial crops cover two-third of the agriculture activities while paddy only 45,360 hectares (2.8 percent).

Since rice is our staple food, rice consumption corresponds to the increasing population. In the 1980s rice consumption n Sabah was 115 thousand tonnes and the consumption increased to 450 thousand tonnes in 2018. The small land size for paddy production obviously does not support the domestic rice consumption. The rice production in Sabah is only about 70, 918 tonnes. Domestic paddy production and rice industry could not even meet half of the local demand. Hence Sabah becomes import dependent for rice, this state depends on 64 percent import of rice, and some estimates this number continues to increase in the next few years.

In 1980 Sabah self-sufficient level (SSL) for rice was recorded 51.2 percent this is the highest ever SSL recorded for Sabah. Policy changes at federal and state level on priority that focus on industrial crops, SSL for rice has shown declining trend. In 1990 SSL for rice dropped to 27.33%. In 2000 SSL slightly went up to 33.6%, the figure showed an upward trend in 2004 when SSL was recorded 40.97%. SSL shows upward trend because there is a push for food security agenda. But food security agenda does not really pick up by policy makers (especially for paddy production and rice industry) thereafter SSL has tapered off, in 2010 SSL accounted for 24.23% and lastest data in 2019 SSL was about 27.12%.

Agriculture is under the purview of the state government, the Ministry of Agriculture and Food Industry in Sabah is one of the ministries that received considerable fund from state budgets also received agriculture development fund from federal government. There are four main policies introduced for the past two decades, namely Sabah First Agriculture Policy (1992 – 2010), Second Agriculture Policy (1999 – 2010), Third Agriculture Policy (2015 – 2030) and the recent one is Sabah Agriculture Blueprint. Most of these policies are extension of federal policy but incorporating Sabah locational advantage. All the tenets of the policy aim to have 60 percent SSL for rice production, this includes improving the farmer’s income, technology upgrading for better yield. After decades Sabah never achieve the intended objectives and continues relying on import, farmer’s income remains low and limited technological upgrading.

Knowing the low supply for rice, the state government approved 10,000 hectares for paddy production in Kota Belud. The aim is to ensure West Coast Division becomes hub for rice producing area for the state and with the capacity to produce almost 60 percent of the paddy production in Sabah. The project is a collaborative effort between state and federal government, i.e., Integrated Agriculture Development Area (IADA) agency under Ministry of Agriculture, Malaysia. Kota Belud is to be ‘Jelapang Padi’ for Sabah managed by IADA, involving an area of 5,000 hectares cultivated by more than 3,600 farmers, with allocation of RM350 million in the 11th Malaysia Plan (RMK11). This paddy cultivation program is a federal-state collaborative efforts to make sure the state can expand the rice industry.

Paddy production and rice industry is highly protected sector, it is one of the sectors that received billions of ringgit in terms subsidies (seeds, fertilisers, chemicals, machinery) every years, however the growth of this sector remains limited. Conventional economic wisdom about protectionist approach along with heavy subsidies in any sectors are bad. This is due to distortion of prices, anti-competitive behaviour, rent seeking, hoarding problems and monopoly. Market-based proponents would claim state interventions will end up anti-growth. On the other hand, developmentalist approach propounds that strategic role of the government in the market would facilitate an industry to grow, basically acting like a ‘big push’ to facilitate farmers or SME have sufficient funding, equipment, training, research and development, physical infrastructure, machinery, and land development (irrigation and drainage) so that paddy production and rice industry can grow sustainably and able to achieve self-sufficient level. The developmentalist state approach has its own merit to help spur industry that is underperforming and pertinent to the people interest, especially rice. It is reasonable to facilitate the industry for certain period until it becomes productive.

If there is considerable support for paddy production but why is it still falling behind? The key problem lies in priority for agriculture development. The state government does not really pay close attention paddy production instead the focus is developing industrial crops cultivation, particularly oil palm. The reason is simple because for example oil palm gives higher return to the state as compared to food crop. Furthermore, industrial crop is easier to manage, high in demand and many investors are interested to venture the plantation. Since Sabah is abundance with land, so easier for rent or to sell the land for oil palm plantation. There are many oil palm conglomerates located in Sabah draining our resources. This easy-money approach deriving from industrial crop has made the state mismatch priority, hence treating paddy production not a primary concern. Managing paddy is not as easy as oil palm, paddy requires careful management and treatment such as fertile soil, proper land, irrigation, etc. This somehow has disincentivised policy makers to seriously push for broader development of paddy and rice industry.

Since paddy and rice industry is not really an overarching priority, the state government shifts their interests to other industrial crops, after all the state knows that there is always constant supply of rice and at affordable price, thanks to Bernas a monopoly government-linked companies that ensure sufficient supply of rice to the country. Shifting interest means development funds will be channelled elsewhere. Supporting Infrastructure like drainage and irrigation, research and development, machinery and etc becomes limited for paddy cultivation program. Instead, the state government continues providing traditional support like seeds, fertiliser, basic ploughing machine and limited irrigation system. Irrigation is key for paddy production but so far only 25 percent of the paddy producing areas are fully irrigated and have sufficient water supply. Most of the paddy plantation irrigated with irregular water supply and the rest are fully dependent on rainfall. Funds for irrigation likely to compete with other industrial crops demand, domestic use, and other industries.

Lack of concerted effort from the state governments in expanding rice industry means that lesser investment in all aspect of rice production system. It is not fair to say that there is no investment at all but the progress to help this industry is rather slow. The impact of lack of investment for instance like technology, quality of seeds, nutrient management, drainage and irrigation and machinery led to low yield. Big part of the paddy management retains some old technology. Paddy cultivation requires different approach depending on category of the paddy, such as wetland, hill/dryland paddy areas may need different facility and technology to support higher yield, unfortunately there is less attention by the state government doing so.

Prioritising land for paddy cultivation is also problematic. Predilection of policy makers towards industrial crops has made policy maker set aside huge land for the industry, even land that is suitable for paddy, exception for Kota Belud, but most of the agriculture activities targeted for other crops including industrial crops. Moreover, certain parts of the land which is suitable for paddy plantation have been prioritise for road, property development, among others.

There are many issues related to rice production system which hinders the state to achieve higher SSL. If the priority focuses on non-food crops, the policy orientation will shift to unheralded areas in agriculture that do not support agro-food industry like rice. Funding, research and development, training, technology advancement, land, will not be prioritised development for rice production eco system. Not to mention patronage in oil palm sector that hijacks the paddy cultivation program. Coordination between state government agencies to set up eco system for rice production system will be problematic since lack of priority. Moreover, the federal funded paddy cultivation program will also slowdown due to coordination problem. Again, this crisis should be a ‘writing on the wall’ – we cannot depend too much of import for our own staple food. Though policy makers will apply the logic of comparative advantage in which we can buy from other countries just because they are more sufficient than us in producing rice. But the existing crisis should be our wake-up call, our staple food like rice we should at least be able to be self-sufficient.

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* Dr Firdausi Suffian is a Senior Lecturer in Political Economy at UiTM Sabah

** The views and opinions expressed in this article are those of the author(s) and do not necessarily reflect the position of Astro AWANI.