Rice import contract cannot be cancelled unilaterally, says Agriculture and Food Security deputy minister

KUALA LUMPUR: The government cannot unilaterally cancel any contract to import rice into the country because it needs to consider the social obligations which Padiberas Nasional Berhad (Bernas) has agreed to implement, the Dewan Rakyat was told on Wednesday (March 15).

Agriculture and Food Security Deputy Minister Chan Foong Hin said as the country’s main rice importer, Bernas needed to fulfil 10 social obligations without getting any grants from the government.

The obligations include managing the country’s rice buffer stock, maintaining its role as the last padi purchaser at a minimum price, and managing padi price subsidy payments as well as the scheme for millers, Bumiputera wholesalers and farmers’ cooperatives.

Apart from this, Bernas also had to allocate funds for supply of machinery and padi mechanisation, development of large-scale padi farms and providing allocations for several programmes, including development of padi seed buffer stock, padi cultivation disaster fund aid and an information system on padi and rice.

"The cost that Bernas needs to bear to continue with the implementation of all these obligations, whether directly or indirectly, is RM3.22bil, and of this figure, RM1.85bil involves farmers and RM1.37bil is for industries and consumers.

"Furthermore, Bernas now also gives a cash contribution of RM60mil and shares 30% of its net profit from rice imports with farmers this year," he said when winding up the debate on the Supply Bill 2023 at the committee stage on behalf of the ministry.

Earlier, several parties had questioned the extension of Bernas’ concession period as the country’s sole rice importer but the government stressed that it was necessary to ensure the commodity remains stable and under control.

The RM3.7bil allocation for the ministry under Budget 2023 was approved at the committee stage by a majority voice vote after being debated by 21 government and opposition MPs. - Bernama