Sunday 19 May 2024
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PUTRAJAYA (May 25): The government allows two refiners to sell fine sugar, a new type, at market price effective May 25. However, the existing ceiling prices remain on refined and coarse sugar, according to Domestic Trade and Cost of Living Minister Datuk Seri Salahuddin Ayub.

Salahuddin said the approval for sugar refiners to sell fine white sugar is effective immediately. The minister, however, stressed that the approval will not replace and disrupt the supply of coarse and refined sugar that are currently available in the market.

“The government also instructed MSM Malaysia Holdings Bhd (MSM) and Central Sugar Refinery Sdn Bhd (CSR) to continue producing sufficient coarse and refined white sugar and to sell [them] at the set retail ceiling price of RM2.85/kg (coarse) and RM2.95/kg (refined),” Salahuddin said, adding there are no changes to the existing sugar ceiling prices.

“Action will be taken against sugar refiners that do not produce sufficient supply of existing refined and coarse white sugar in the market,” he said, adding the same goes for any wholesalers and retailers who selectively purchase or do not sell existing refined and coarse white sugar to customers.

“The government agrees with this request (by the two refiners) because fine white sugar will give consumers a choice other than the existing coarse and refined white sugar [in the market],” Salahuddin told the press at the Putrajaya International Convention Centre (PICC).

Specifically, Salahuddin said the condition the government has imposed on sugar refiners to sell fine white sugar is that there must be coarse and refined white sugar supply of 42,000 tonnes a month.

Salahuddin noted the fine white sugar prices set by MSM and CSR are monitored by the Malaysia Competition Commission (MyCC).

Previously, sugar refiners were not allowed to sell fine white sugar as the introduction of any new sugar product in the market must first be approved by the ministry as sugar is a controlled item pursuant to the Control of Supplies Act 1961.

Meanwhile, Salahuddin said 'Ops Manis' was carried out to identify the causes of and solution to sugar shortage in several states. He noted that the operation will continue for another month to prevent instances of sugar price gouging as well as to ensure sufficient supply of sugar.

In comparison with regional peers, Malaysia’s retail sugar prices are the cheapest in the region, with the Philippines limiting its sugar price at RM8.50/kg, followed by Singapore and Vietnam both at above RM6/kg, Indonesia (RM4.40/kg), and Thailand (RM3.20 to RM3.50/kg), according to MSM.

MSM and CSR have urged Putrajaya to review the sugar retail price — in the form of a price hike or floating price — to safeguard the sustainability of the local sugar industry, highlighting the industry has not received any government subsidy for a decade.

For the financial year ended Dec 31, 2022 (FY2022), MSM sank into the red with a net loss of RM178.71 million versus a net profit of RM125.35 million a year earlier, despite a 13.55% rise in revenue to RM2.57 billion from RM2.26 billion previously.

The sugar refiner attributed the drop in bottom line to prolonged margin compression of its domestic controlled price retail segment and lack of subsidy.

At the noon break on Thursday, MSM’s share price was one sen or 1.2% lower at 82 sen, giving the company a market capitalisation of RM576.44 million.

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Edited ByKathy Fong
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