Malaysia-China deal to boost local bird’s nest prices

It is expected to happen in April or May when exports get green light

KUCHING: Domestic prices of bird’s nests, which have stabilised for months, are expected to get a boost once the much awaited exports of the raw and uncleaned nests to China get the go-ahead soon.

And that is anticipated to happen in April or May this year,according to local industry players.

This follows the recent signing of a deal between Malaysia and China to ship raw edible nests to China.

Under the deal, known as Protocal of Inspection,Quarantine and Veterinary Hygiene Requirements for the Exportation of Raw,Uncleaned Edible Nests, it sets the standards for Malaysia’s 10,000 bird’s nest farmers to sell their raw product to the Agriculture and Agro-based Industry Ministry.

The ministry will then export the raw nests untouched to China where it will be processed and cleaned up in Qinzhou and then sold to the Chinese market.

According to media reports, Malaysia has a RM22mil joint quarantine,processing and testing plant with China in the Qinzhou Industrial Park.

Minister Datuk Seri Ahmad Shabery Cheek was quoted last November as saying that the Malaysia-China deal could bring about RM1.5bil in profits to the local bird’s nest industry .

“Once the raw bird’s nests are allowed to enter China, the general expectation of the industry is that there is potential for prices to go up by 15% to 20% from current levels depending on the grades,” said Wong Hie Yong, a Sarikei-based pioneer swiftlet breeder and trader.

He said top grade raw bird’s nest price had stablised at the RM2,800 per kg level although the price of the super grade (constitutes merely 2% to 3% of total production) could go up to around RM3,300 per kg.

Currently, the super grade processed nests fetches between RM5,500 and RM6,000 per kg when exported.

“At current price levels, the demand is good. There are several licensed traders, mostly from Peninsular Malaysia, and Chinese nationals who are going around to buy the raw nests from local farmers.

“They are said to stock up the edible nest in anticipation that prices will go up once Malaysia starts to export the unprocessed nests to China,” Wong, whose family own some 15 stand-alone swiftlet houses, told StarBiz.

The price of Malaysia’s bird’s nest plunged when China banned imports in 2011 after the detection of nitrate in some of the nests. In Sarawak, unprocessed nest fell to around RM1,300 per kg from the peak of RM4,500 per kg while top grade processed nest dropped to some RM3,000 per kg from RM7,000 per kg.

A strong recovery in the prices came in 2015 when China resumed importing Malaysia’s processed bird’s nest while Indonesia started sourcing the delicacy from Malaysia due to drastic drop in production after the severe haze that hit several swiftlet production regions in that country.

According to Wong, a new trend – auction market – has emerged in Peninsula Malaysia where traders/buyers, including those from Indonesia, China and Thailand, are invited to tender for edible nests on a big scale.

“Trading of edible nest in Malaysia is moving towards the international standard. This is encouraging and supporting the local swiftlet industry,” he said.

He said bird’s nest production in Sarawak’s central region had dropped by between 30% and 40% following the recent El Nino and dwindling feeding grounds for the swiftlets.

“The feeding grounds have been affected due to environmental changes because of development or floodings which have caused damages to the habitats.

“It is thus more difficult for the swiftlets,which feed on insects, to find food even in the coastal areas.

“It is reported that swiftlets from towns have migrated to new and greener areas,like oil palm plantations in the rural, where they can find food easier.”

Sarawak is estimated to produce an average of 8,000kg of raw nests per month. There were some 4,000 to 5,000 bird houses, mostly in central region,about seven years ago. The figure could have dropped in recent years when prices declined, making it less lucractive to invest in swiftlet farming. Many of the bird houses are not registered with the authorities.

Wong said similarly in the peninsula,bird’s nest production has declined,especially in matured breeding areas due to the depleting habitats for the birds.