PAPAR: Sabah, Labuan and Sarawak will no longer face a shortage in the supply of refined white sugar, with the establishment of a stockpile of 2,000 tonnes starting May 1.
Announcing this, Domestic Trade and Cost of Living Minister Datuk Armizan Mohd Ali said 1,000 tonnes of the stockpile will be allocated to Sabah and Labuan, and the remaining 1,000 tonnes for Sarawak.
Armizan, who is also Papar MP, said the move was necessary because of the regions’ total reliance on sugar supplies from Peninsular Malaysia, as no sugar manufacturers are operating in Sabah, Sarawak or Labuan.
“That’s why the Ministry submitted a proposal to the Federal Cabinet to establish a stockpile to ensure a consistent supply, which was approved by the Cabinet at its meeting on March 26.
“We estimate the stockpile will be able to meet supply needs in these areas for between three and six months,” he said to reporters after attending the Aidilfitri celebration hosted by the Papar MP and Kawang Assemblyman, here, Sunday.
Armizan said a serious supply disruption occurred between August and October 2023, making it necessary for the Government to come up with an effective solution like a stockpile to prevent a recurrence.
He added that logistics factors were also considered in implementing this policy, as it takes about five days for sugar shipments from Peninsular Malaysia to reach Sarawak and seven days to reach Sabah.
“We import raw sugar from abroad, and the challenge we face is that we do not produce raw sugar on a large scale in Malaysia, and there are no manufacturers processing raw sugar in Sabah or Sarawak,” he said.
“So I welcome any initiative by the Sabah and Sarawak state governments to perhaps, through their GLCs (government-linked companies), establish sugar manufacturing companies to process raw sugar and ensure a stable market supply,” he added.
Armizan said even with the stockpile, refined white sugar will continue to be sold at the controlled price of RM2.85 per kg, as that price reflects the Government’s incentive to the manufacturers.
“The raw sugar we import is far more expensive than the actual price of refined sugar, which is RM3.85 per kg – RM1 higher than the controlled price. The special government incentive given to manufacturers is to maintain the price ceiling,” he said.
He added that to ensure the effective implementation of this policy, the Ministry will establish a Supply and Price Stabilisation Committee, comprising representatives from ministries, departments, agencies and industry players, which will convene at least six times a year.
According to Armizan, in addition to the stockpile, the Federal Government has also approved an increase in transport subsidy allocation for shipping refined white sugar to Sabah, Sarawak and Labuan.
“The allocation is now RM38 million a year, compared to RM19 million previously. The subsidy rate has been raised from 10 sen to 20 sen per kilogramme, which also contributes to efforts to stabilise sugar supply,” he said.
