Chan, Sok Gee

Ramly, Zulkufly

The International Islamic University Malaysia Repository

1/10/23, 9:17 AM Curb food production costhttps://www.nst.com.my/opinion/letters/2022/08/822923/curb-food-production-cost 1/4anded in Australia, chose to  y back on Jan 5, says AirAsia X POLITICS  New Sabah cabinet may be sworn in toda    Curb food production costAugust 17, 2022 @ 12:03amThe government should continue helping the agriculture sector with short-termmeasures. - FILE PICLETTERS: The surge in prices of commodities and intermediate products,especially those linked to agriculture, has resulted in a higher producerprice index (PPI).PPI measures the average changes in prices received by domesticproducers for their output.As of early June, Bank Negara Malaysia (BNM) reported that the PPI andconsumer price index (CPI) had increased by 11.2 and 3.6 per centrespectively.This shows that producers are absorbing the higher cost of production,which has dampened their cash  ow.MORE NEWSEventually, producers will transfer rising costs to consumers by increasingthe prices of goods and services.This is inevitable if the government has not taken steps to mitigate theincreasing cost of production, i.e. controlling the supply side of in ation.PPI is a strong indicator for the CPI, especially when in ation is due tosupply-push rather than demand-pull in ation.Rising food costs take a bite out ofThanksgiving dinnerExpand childcare subsidies to re ectrising costs, says groupBDB to venture into food production,power and telecommunicationssectorsMore competition for healthcareinstitutions will drive down pricesMOST POPULARLATEST MOST READGET THE LATEST TOP NEWS DAILYSign up to receive NST daily newsletters!Your nameE-mail AddressSIGN UP NOWACROSS NEW STRAITS TIMESWHAT TO READ NEXT2m #JOM! 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Here, subsidies should be directed towardscurbing the rising cost of production and administering forward-shiftingbehaviour of businesses.A few immediate measures can be rolled out. First, Malaysia depends onimported seeds, which makes agriculture vulnerable to changes in theprices.Hence, subsidies to import seeds of food crops, such as vegetables andother agricultural products, should be given to alleviate rising cost inagriculture, forestry and  sheries.Second, shortage of animal feed caused by economic sanctions onRussia for the Ukraine con ict and climate change has pushed prices up.Therefore, subsidising animal feed is necessary because it constitutes 70per cent of poultry's production cost. Stopping it reduces the supply ofpoultry, which raises the prices.Subsidies for small and medium enterprises can increase the supply ofmeat products and output of animal produce, strengthening SMEs andweaken the in uence of cartels in the supply chain.Finally, worker shortages and higher labour cost in agriculture alsocontribute to in ation. Subsidies to hire locals on minimum wagealleviates higher production cost.The subsidy is to compensate local producers who have to bear highercost due to the increase in wages. This can also boost the supply oflabour in the market and overcome labour shortages in agriculture.Furthermore, subsidising the employment of locals motivates householdsto enter the workforce instead of relying on government handouts.Extensive cash handouts not only result in a complacent workforce butalso limit availability of funds for development and welfare measures.Subsidies are a short-term measure to put off the immediate effects ofin ation on people.Finally, the transformation of agriculture is long-overdue after decades ofneglect. The transformation should include greater use of biotechnologyand modern technology, as well as research to reduce costs and increaseproductivity.Besides, the emergence of the new economy increases theinterdependency of all economic sectors.Consequently, it is crucial to have a holistic view to integrate agriculture,manufacturing and the services sector to stimulate economic growth andmeet the goals of a sustainable economy and long-term prosperity forMalaysia.BRANDED CONTENTSTORIES FROM SAYSWoman who drives A-Class Mercedescaught for avoiding paying toll charges45 timesOTHERS Jan 9, 2023 @ 8:16pmNot the end of the world, says Crossafter juniors fall short at British JuniorOpenWORLD Jan 9, 2023 @ 8:38pmPalestinian PM says Israeli sanctions'new war'CRIME & COURTS Jan 9, 2023 @ 8:06pm1MDB: Roger Ng granted discharge notamounting to acquittal pending US trialconclusionNATION Dec 15, 2022 @ 9:01pmPETRONAS committed to net zerocarbon emissions by 2050Jan 7, 2023 @ 3:14pmTwo M'sian Teams Are Competing ForA RM3.5 Million Prize Pool At The M4World ChampionshipJan 9, 2023 @ 8:24pmView Cantik & Bersejarah, Ini 7 LokasiUnik Di Thailand Yang Sesuai UntukFeed Instagram!Jan 9, 2023 @ 6:10pmWoman Buys RM1.97 MillionApartment Only To Find Out SomeoneHad Died ThereJan 9, 2023 @ 5:43pmAnwar: We Will Never Recognise TheLGBT, Communism, And SecularismJan 9, 2023 @ 5:39pm"This Is My Car, Not Yours!" – E-hailingDriver Scolds Passenger For TouchingHis Aircon1/10/23, 9:17 AM Curb food production costhttps://www.nst.com.my/opinion/letters/2022/08/822923/curb-food-production-cost 3/4DR CHAN SOK GEEAssociate professor, Institute of China Studies, Universiti MalayaDR ZULKUFLY RAMLYAssociate professor, Department of Finance, International IslamicUniversity MalaysiaThe views expressed in this article are the author's own and do notnecessarily re ect those of the New Straits TimesRELATED VIDEOSRELATED ARTICLESLETTERS Dec 15, 2022 @ 12:09amWays to tackle high cost of livingLETTERS Dec 13, 2022 @ 12:10amThe best way to ward off highfood prices is to boost incomeREGION Nov 8, 2022 @ 10:29amPhilippines launches greenrevolution 2.0 to boost foodproductionREGION Aug 12, 2022 @ 10:12amHigher food prices in Japan due toimport costs and weaker yen1/10/23, 9:17 AM Curb food production costhttps://www.nst.com.my/opinion/letters/2022/08/822923/curb-food-production-cost 4/42023 © New Straits Times, New Straits Times Press (M) Bhd. 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Curb food production cost

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Curb food production cost

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