PAPAR: The government will establish a stockpile of 2,000 tonnes of refined white sugar for Sabah, Sarawak and Labuan in stages beginning May 1, to ensure a stable supply of the commodity in those regions, said Datuk Armizan Mohd Ali.
The Domestic Trade and Cost of Living Minister said that 1,000 tonnes of the stockpile will be allocated to Sabah and Labuan and the remaining 1,000 tonnes will go to Sarawak.
Armizan, who is also the Member of Parliament for Papar, 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.
“These manufacturers are only located in Peninsular Malaysia, so items like sugar require specific measures. That’s why the ministry submitted a proposal to the federal Cabinet to establish a stockpile to ensure a consistent supply.
“The proposal 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.
He said this to reporters after attending the Aidilfitri celebration hosted by the Papar MP and Kawang state assemblyman here today.
Also present were Sabah Yang Dipertua Negeri Tun Musa Aman, Chief Minister Datuk Seri Hajiji Noor and Kawang state assemblyman Datuk Ghulam Haidar Khan Bahadar.
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 that even with the stockpile, refined white sugar will continue to be sold at the controlled price of RM2.85 per kilogramme, 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 kilogramme – 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.
