Even though I’m sure everyone’s looking forward to the day when chickens can be exported freely out of Malaysia, it seems like it might not be the case based on what an economist in Malaysia predicts.
Recently, Free Malaysia Today reported on a report made by Geoffrey Williams, Professor and Dean of the Institute of Postgraduate Studies at Malaysia University of Science and Technology. Williams posted the write-up on his LinkedIn page.
According to Free Malaysia Today, Williams explained that the issues caused by Malaysia halting chicken exports to Singapore have revealed the issues that often have to do with food production, distribution and trade and lack of security.
He also told the Malaysian online newspaper that even though Singapore received 33% of its total chicken consumption in the form of chicken exports from Malaysia, Malaysia only exports a total of 6% of its poultry.
Hence, Malaysia’s chicken ban technically has a much greater impact on Singapore than it does on Malaysia.
He also expressed support for the Malaysian government’s choice to set a limit for the prices of chickens sold locally and to “improve domestic supply by encouraging imports and discouraging exports” in his LinkedIn post.
“After that, long-term market reform and liberalisation are the answer to food insecurity issues,” he added.
Apart from that, he suggested for the import permits for food and animal feed to be lifted since these permits will only increase the cost of feed, resulting in consumers having to pay higher prices for meat.
Williams emphasised the importance of tackling anti-competitive behaviour within the market such as cartels that are indirectly taking charge of the prices and production of chicken.
He then predicted that the market for chicken will bounce back to its original state after the export ban to Singapore is lifted.
Another Economist: Price Ceilings are “Punishing” the Industry, May Not Win Back Singapore Market
Despite Williams’ optimistic outlook, it seems like another Malaysian economist has a different take on the matter.
Carmelo Ferlito, CEO of Kuala Lumpur-based think tank Center for Market Education, told Free Malaysia Today that Malaysia was “punishing” the poultry industry by enforcing an export ban and price ceilings.
According to Ferlito, this could result in price tensions becoming more severe and lengthen the adjustment process between supply and demand as well.
Additionally, he had a different view regarding who would be more affected by the export bans.
In contrast to Williams’ opinion, he stated that the shortage of Malaysian chicken in Singapore may cause the Singapore market to source for chicken completely from elsewhere.
Apart from that, the export ban could affect local chicken producers in Malaysia, causing them to shut down their businesses, which would in turn affect the local chicken supply negatively as well.
He pointed out that with Malaysia’s export ban, it makes complete sense for other countries that import Malaysian food products to look for other sources.
And as for Singapore, plans have been made to import chilled chicken from Australia and Thailand, as well as frozen chicken from other countries such as Brazil and the United States.
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