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Singapore Braces as Malaysian Hen Export Ban Comes Into Impact – The Diplomat


ASEAN Beat | Financial system | Southeast Asia

Kuala Lumpur is simply the newest Asian authorities to take steps to shore up home meals provides.

Singapore Braces as Malaysian Chicken Export Ban Comes Into Effect

Reside chickens wrapped in newspapers on show on the Sibu Central Market in Sibu, Sarawak, Malaysia.

Credit score: Depositphotos

Yesterday, I wrote a quick article concerning the proposed formation of a rice export cartel between Thailand and Vietnam, which I described as simply the newest signal of a flip towards protectionism and market interventions within the context of hovering world meals costs.

At the moment introduced one other instance of this development, with Malaysia starting a ban on the export of dwell chickens, to bolster home provides and maintain down surging costs.

Final week, Malaysian Prime Minister Ismail Sabri Yaakob introduced that the nation would halt exports of three.6 million chickens a month from June 1. Ismail Sabri added that the Malaysia Competitors Fee can even open investigations into stories that there are cartels that management the worth and output of hen amongst massive corporations.

He mentioned that the ban could be in place “till home costs and manufacturing stabilize,” including, “The federal government’s precedence is our personal folks.”

In current weeks, Malaysia, which imports round 60 % of its meals wants, has seen rising meals costs on account of rising world commodity costs and a weakening ringgit. In accordance with Malaysian farmers, the rising costs of hen are the results of the rising value of hen feed, which is in flip linked to a grain scarcity attributable to Russia’s invasion of Ukraine. Because of this, some retailers have needed to resort to rationing the gross sales of hen.

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The export ban is more likely to have an effect on numerous Asian nations, however none as a lot as import-dependent Singapore, which final yr sourced about 34 % of its hen from Malaysia. Virtually all of those imports had been dwell chickens that had been slaughtered and chilled in Singapore. The Straits Occasions cited hen sellers as saying that the price of uncooked hen might rise by as much as 30 %, sending the worth of the city-state’s toothsome hen rice dish spiraling upward.

Yesterday, a day forward of the ban, Channel Information Asia noticed lengthy queues at hawker facilities throughout the city-state yesterday, whereas the upcoming scarcity has prompted the COVID-19-style panic-buying of hen from moist markets and supermarkets.

In addition to signifying the rising world flip towards protectionism, which additionally included a short lived Indonesian palm oil export ban and Indian restrictions on sugar and wheat exports, the hen export ban highlights Singapore’s vulnerabilities to disruptions within the world meals provide. Because of its dearth of arable land, the overwhelming majority of the nation’s meals – north of 90 %, in keeping with the Singapore Meals Company (SFA) – is imported, leaving it uncovered to exterior shocks.

After Malaysia introduced the export restrictions final week, the SFA mentioned it was working to attenuate the influence on provide by tapping different sources of imports. In accordance with SFA knowledge cited by Channel Information Asia, different main sources of hen for Singapore embody Brazil (49 %) and the USA (12 %). “Whereas there could also be short-term disruptions to the availability of chilled hen, frozen hen choices stay accessible to mitigate the shortfall,” the SFA mentioned.

Singapore’s competent authorities could be anticipated to make sure that the general influence on its residents will possible be one among inconvenience reasonably than outright disaster. However as the worldwide financial disaster worsens, the political influence in different nations is more likely to be extra extreme.

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