The Malaysian government will create a sugarcane buffer stock to ensure a stable supply in Sabah, Sarawak, and Labuan. This measure aims to prevent future supply disruptions and keep the price of refined white sugar at a controlled level.
The Malaysia n government plans to establish a buffer stock of 2,000 metric tons of refined white sugar in Sabah , Sarawak , and Labuan starting May 1st. This initiative aims to ensure a stable sugar supply in these regions. Minister of Domestic Trade and Cost of Living Datuk Armizan Mohd Ali explained that 1,000 metric tons will be allocated to Sabah and Labuan , while the remaining 1,000 metric tons will go to Sarawak .
This decision was made considering the regions' complete reliance on sugar imports from Peninsular Malaysia, as there are no local manufacturers in Sabah, Sarawak, or Labuan. Armizan emphasized the necessity for special measures due to this dependency. The Ministry proposed the buffer stock idea to the Federal Cabinet, which was approved on March 26th. The minister estimated that this stock could meet the demand in these regions for three to six months. He highlighted that serious supply disruptions occurred between August and October 2023, making this buffer stock a crucial solution to prevent future recurrences. Armizan acknowledged the logistical challenges in transporting sugar from Peninsular Malaysia, with delivery times ranging from five days to Sarawak to seven days to Sabah. He stressed the country's reliance on imported raw sugar due to the absence of large-scale domestic production and processing facilities in Sabah and Sarawak. He encouraged the Sabah and Sarawak governments to consider establishing sugar processing companies, potentially through government-linked corporations, to ensure a consistent supply. Despite the buffer stock, the refined white sugar will continue to be sold at the controlled price of RM2.85 per kilogram. Armizan explained that the price of imported raw sugar is significantly higher at RM3.85 per kilogram, but the government is providing special incentives to manufacturers to maintain the controlled price. To monitor and ensure the effectiveness of these measures, a Supply and Price Stabilization Committee will be established, comprising the ministry, relevant departments, agencies, and industry players. The government has also approved an additional allocation of RM38 million per year for shipping subsidy for transporting refined white sugar to Sabah, Sarawak, and Labuan, compared to RM19 million previously. This increase represents a rise from 10 sen to 20 sen for each kilogram
Sugar Supply Chain Malaysia Sabah Sarawak Labuan Buffer Stock Price Control Logistics Import Dependency
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