Govt cuts egg subsidies by half, targets complete removal by Aug 1
Between February 2022 and December last year, the government spent nearly RM2.5 billion on egg subsidies to help the industry manage higher production costs due to Covid-19 and the Ukraine-Russia war.
PETALING JAYA : The government has decided to end the price controls on chicken eggs and reduce the subsidies from 10 sen to 5 sen per egg, effective tomorrow.
In a statement, the agriculture and food security ministry said the subsidy for chicken eggs would be fully removed from Aug 1.
'This decision was made after taking into account the industry's commitment to ensuring sufficient and stable egg production, as production costs have stabilised.
'This was evident during the recent Aidilfitri festive season, where supply remained adequate and prices were competitive,' it said.
The ministry said that to minimise the impact of the decision, it would collaborate with the domestic trade and cost of living ministry for the introduction of a special grade of egg at an affordable price.
It also said that consumers could continue to buy eggs at competitive prices through Agro Madani Sales and Rahmah Sales programmes nationwide.
Last October, its minister Mohamad Sabu said Putrajaya was considering ending subsidies for chicken eggs if the supply stabilised. The savings could then be redirected to develop other critical agro-food sectors, he said.
In June 2024, Prime Minister Anwar Ibrahim announced that the government had decided to reduce the retail price of grade A, B and C eggs nationwide by 3 sen. This subsidy scheme involved an expenditure of RM100 million.
The government initially planned to float egg prices in July 2023, but postponed the move due to concerns about potential price increases and the impact on consumers.
Between February 2022 and December last year, the government spent nearly RM2.5 billion on egg subsidies to help the industry manage higher production costs due to Covid-19 and the Ukraine-Russia war.
The ministry said today that the government considered prolonged price controls and subsidies unsustainable for both the long-term viability of local egg producers and the country's fiscal health.
It said rationalising subsidies was the fairer approach, as subsidies are currently also enjoyed by foreign nationals and high-income groups.
'The savings from this initiative can be redirected to fund targeted projects that promote public well-being, in line with Madani values,' it added.
The domestic trade and cost of living ministry will also step up efforts through continuous monitoring to curb profiteering and price manipulation by irresponsible traders, it said.
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