Where does Malaysia’s paddy and rice industry stand?

Malaysia has been importing about 30%-40% of its rice consumption annually for the last 30 years.

And according to some studies, the country will likely continue to be a net rice importer in the years to come.

The question is, does Malaysia’s inability to achieve 100% self-sufficiency level (SSL) in rice production by 2020 (as targeted just five years ago by the then Barisan Nasional-led government) signify a failure for the heavily subsidised industry?

According to Khazanah Research Institute (KRI), it does not.

“Statistical trends, geography and consumer preferences for premium rice means that Malaysia is likely to continue being a net importer,” the think tank explains.

“Considering this, the nation may be in a better position not to target 100% SSL, but with domestic rice produced sustainably, responsibly, safely and where farmers earn a sustainable income,” it adds.

In its recently published “The Status of the Paddy and Rice Industry in Malaysia” report, KRI finds that despite the significant public resources allocated to the industry, paddy farming is still perceived to be uneconomical.

In addition, paddy farmers are still associated with poverty; and Malaysia is still a net importer of rice with SSL hovering around 60%–70%.

It states that it is high time for the country to review its agricultural strategies, as the country has the potential to cultivate paddy responsibly, productively and still achieve better income for the farmers.

While it is unrealistic to expect Malaysia to be a net exporter of rice, KRI notes, it is sensible for the country to aim at achieving a balance of being a net importer, but with local farmers producing high quality grains and adhering to good agricultural practices.