Ministry denies existence of rice cartel

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The Agriculture and Food Security Ministry has denied allegations of the existence of a cartel that controls prices of rice and paddy seeds in the country.

In a statement yesterday, the ministry clarified that the country’s rice industry was regulated by the Kawalselia Padi dan Beras (KPB) regulatory body through the Rice Control Act 1994.

According to this act, the ministry carries out regulatory activities through licensing and enforcement to ensure a healthy and orderly development of the rice industry.

“This Act also grants powers to the director-general of the KPB to issue licences and permits for padi and rice transactions, including manufacturing, wholesale, retail, import or export, and inter-state transfers,” the statement read.

The statement also mentioned that the issuance of 39,000 various licences, such as wholesale rice licences, export licences, import licences, paddy mill licences, paddy purchase licences, retail rice licences, and special approvals to sell paddy seeds for certified paddy seeds (BPS), clearly indicates that there is no cartel or mafia capable of monopolising the rice industry.

“As for BPS, the ministry has allocated 72,000 metric tonnes of BPS to meet the needs of farmers for the year 2023.

“The manufacturing licence for BPS is also granted to government-linked companies to supply paddy seeds to farmers. The confirmation of BPS through laboratory tests is carried out by the Malaysian Department of Agriculture,” according to the statement.

Meanwhile, the ministry announced that it conducted the BPS Operation Task Force from Nov 7 to 21 to ensure that all retailers sell BPS at government-set prices and there is no element of adulteration in BPS.

Through this operation, the ministry revoked a total of 22 BPS sales licences held by retailers who violated licence conditions.

“The ministry warns all manufacturers, wholesalers, and retailers to always comply with the laws and will not compromise with any party attempting to take advantage of this issue. Firm action will be taken, including licence cancellation, if any legal violations are found,” according to the statement.

Farmers and consumers are also advised to submit complaints or information officially to the ministry if there are any legal violations through the KPB complaint portal or aduankpb@kpkm.gov.my or through the hotline 03-88701751/1748/1183.

Earlier, the chairperson of the Malaysian Rice Manufacturers’ Association, Marzukhi Othman, was reported as claiming the existence of a rice cartel comprised of four to five large companies for a long time, shaping the direction of the country’s rice industry, leading to prolonged issues of paddy seeds every season and rice supply problems.