News | Russia’s Ukraine attack likely to hit Malaysia with price increases
KUALA LUMPUR: Prices of certain goods in Malaysia will record a significant increase should there be no intervention from the government, following the ongoing conflict between Russia and Ukraine.
Several traders and breeders’ associations said the price hike of certain goods is expected following the conflict, which will lead to a spike in oil prices as well as commodities such as corn, soybeans and palm oil.
Federation of Livestock Farmers’ Associations of Malaysia (FLFAM) advisor Datuk Jeffrey Ng said he believes that the prices of chicken were expected to increase further next month, following the conflict involving the two European neighbours.
This, he said was because the main ingredients used to produce chicken feed – namely corn, soybean and palm oil, have soared since Russia’s attack on Ukraine started on Thursday.
“Ukraine is a producer of wheat and corn and controls about 70 per cent of the world market. The war has caused a spike in corn prices.
“Concurrently, the prices of soybean and palm oil have also increased, with the price of crude palm oil yesterday rising to a record high of more than RM6,800 per metric tonne.
“These are all main ingredients for chicken feed, and the factories have informed that there will be an increase in the price of chicken feed next month.
“However, the rate is still unknown as it depends on the period of the conflict between Russia and Ukraine,” he told Berita Harian today when asked about the possible increase in chicken prices, following what is happening in Ukraine.
Yesterday, Domestic Trade and Consumer Affairs (KPDNHEP) Minister Datuk Seri Alexander Nanta Linggi reminded traders against using the escalating conflict between Russia and Ukraine as an excuse to raise the prices of their goods or services arbitrarily.
He said although, in terms of economic principles, conflicts or wars could cause the prices of goods and services to rise, such an increase would not necessarily be happening worldwide.
Meanwhile, commenting further, Ng urged the government to increase the selling price of chicken from farms, due to the rising cost following the conflict.
He said chicken rearers will suffer and eventually incur losses, adding that the subsidy amounting to more than RM500 million to the rearers was based on previous operating costs.
“If the matter cannot be resolved, Malaysia is at risk of a chicken supply shortage crisis, as many of the rearers will go bankrupt or do other businesses because they can no longer afford to bear the losses.
“Now, it is also difficult to calculate the cost as the Agriculture and Food Industry Ministry said that the farm-level price of chicken is RM5.90, but KPDNHEP said it is RM5.60. Which one should we follow?” he asked.
Malaysian Federation of Hawkers and Petty Traders Association president Datuk Seri Rosli Sulaiman also expects an increase in the prices of non-controlled goods following an increase in oil prices, due to the conflict.
“The increase in oil prices would affect the logistics costs, certain raw materials and operating costs.
“Factories and wholesalers may have to increase their selling prices, and the same goes with traders.
“Therefore, I hope that the government will maintain the oil subsidy to ensure no significant impact on the prices of goods,” he said.
Selayang Wholesale Market Hawkers and Petty Traders Association chairman Mohammad Pandu Insani Yahya believes that the prices of goods such as chicken will be affected by the conflict.
“The same goes for the prices of imported goods, should the source countries also be affected by the conflict.” – NST
by: Ahmad Suhael Adnan
credit photo: TheMalaysianReserve