PETALING JAYA: The removal of subsidy for eggs from Aug 1 is likely to see prices going up, but only temporarily.
It will also not be as expensive as the cost of higher grade eggs, as production of eggs is also set to increase, says an industry player.
Mydin managing director Datuk Ameer Ali Mydin said retailers have been asking the government to boost the supply of chicken eggs in the market.
This move, he said, will also stimulate the export of the produce.
“We used to have a high production and exports of chicken eggs, but when price control and subsidy was introduced, farmers were not encouraged to sell their produce overseas.
“This move will encourage exports and it will be beneficial for the country,” he said.
The Agriculture and Food Security Ministry announced yesterday that the price control on chicken eggs has been lifted, with subsidies reduced from RM0.10 to RM0.05 per egg, effective today.
The egg subsidy will be completely abolished on Aug 1.
On the possibility of traders taking advantage of any increase in egg prices after Aug 1, Ameer Ali said this will be temporary and that the government will be able to manage the situation.
“I think the government has enough power to enforce anti-profiteering laws to curb people from taking advantage of the price control removal,” he said.
Federation of Malaysian Consumers (Fomca) chief executive officer Saravanan Thambirajah agreed.
He said the authorities will have to continue strict monitoring of the consumer price index (CPI).
“The ministry concerned should take firm action against any opportunistic price hikes that are not justified by cost increases.
“It also needs to ensure that pricing mechanisms remain transparent and fair,” he said, calling the abolition of the subsidy a step forward to a more sustainable and targeted subsidy system.
However, Saravanan also said that the move must also be in tandem with robust protection for vulnerable groups as well as supply chains.
“We understand the need to optimise national spending and redirect fiscal resources to where they are needed most.
“At the same time, we stress the importance of implementing proper safety nets, particularly for the lower income group and vulnerable groups,” he said.
Meanwhile, Pertubuhan Mesra Pengguna Malaysia deputy president Azlin Othman warned that consumers from the low income group could be badly affected by the removal of the price control.
She urged the government to reconsider, especially taking into account the effects on the vulnerable.
“We are concerned that there might be a price increase of between 20% and 50% when the subsidy for chicken eggs is removed.
“There might also be issues with shortage of supply. The impact on consumer depends on the support by the government,” she said.
MCA vice-president Datuk Lawrence Low, however, felt the government should reconsider its decision to withdraw price controls and subsidies.
He said it could increase the monthly household expenses by RM15 for a family of five, based on the average consumption of one egg per person per day.
“The government’s claim that production costs have stabilised is simply unreasonable, given the continuing conflict and uncertainties posed by the United States’ retaliatory tariffs,” he said in a statement yesterday.
From February 2022 to December 2024, the government said it spent nearly RM2.5bil on egg subsidies to cover rising production costs caused by the Covid-19 pandemic and the Ukraine-Russia war, which affected prices of chicken feed.
“Where has the revenue from the Sales and Service Tax, which has been raised from 6% to 8%, gone?
“And what about the income from newly introduced taxes?” he asked.
