How will the RM950 per tonne subsidy affect rice prices for consumers?

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Subsidy to Stabilise Imported White Rice Prices at RM31 per 10kg in Sabah, Sarawak, and Labuan

The Federal Government's subsidy of RM950 per tonne for imported white rice (BPI), effective October 5 in Sabah, Sarawak, and Labuan, is intended to ensure consumers can purchase a 10-kilogramme (kg) pack at a retail price of RM31. This initiative aims to address the soaring prices of BPI in these regions, which have been driven by high demand and low local production during the non-harvest season. Wholesalers in Sabah have committed to absorbing the cost difference for BPI purchased before the subsidy's implementation, allowing retailers and supermarkets to sell existing stock at the new controlled price.
Subsidy Implementation and Retail Price Control

The Federal Government has allocated a subsidy of RM950 per tonne for imported white rice in Sabah, Sarawak, and Labuan, commencing October 5. This financial support is specifically designed to enable the retail price of BPI to be maintained at RM31 for a 10kg package. The measure is a direct response to the current market conditions where the demand for BPI is high in these eastern states, exacerbated by the scarcity of local white rice due to the ongoing non-harvest season.
Wholesaler Commitment to Price Stability

Wholesalers in Sabah, including prominent entities like Sazarice and TKC, have agreed to a cooperative arrangement regarding existing stock. They have committed to allowing retailers and supermarkets to sell BPI that was acquired before October 5 at the newly subsidised price. Under this agreement, these wholesalers will bear the difference in costs, ensuring a smooth transition and preventing an immediate price hike for consumers as the subsidy takes effect.
Broader Efforts to Enhance Local Rice Production

Beyond the immediate price stabilisation of imported rice, the Federal Government is actively pursuing strategies to increase the production of local white rice, particularly in Sabah. Initiatives such as the Large-Scale SMART Paddy Field (SBB SMART) Programme, implemented in collaboration with Paddyberas Nasional Berhad (Bernas) within the Integrated Agricultural Development Area (IADA) in Kota Belud, aim to introduce modern farming equipment and techniques. Furthermore, discussions are underway to identify suitable land, with Deputy Prime Minister Datuk Seri Dr Ahmad Zahid Hamidi reportedly identifying 50 hectares in Sabah and Sarawak for paddy cultivation.
Focus on Increasing Sabah and Sarawak's Rice Contribution

The Ministry of Agriculture and Food Security, in conjunction with Sabah's Ministry of Agriculture, Fisheries and Food Industry (Maffi), is also planning joint development programmes to establish rice granaries within the state. Currently, Sabah and Sarawak contribute a modest three to four per cent to the nation's overall rice production. These collaborative efforts signify a strategic push to bolster local rice output in these regions, aiming to reduce reliance on imported rice in the long term.

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How will the RM950 per tonne subsidy affect rice prices for consumers?

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