PETALING JAYA: The cost of animal feed eats into 85% of the overall farm operations; as such, any increase will have an obvious impact on the business and the broiler, said poultry and animal feed farmers.
Mohd Izzuddin Che Arifin of Trinardi Timur Sdn Bhd said they expect the prices of chicken, meat and eggs to increase.
Currently, he said, they have not felt much of a difference.
However, he did acknowledge that operation costs are also determined by the number of chickens in the farm, diseases, weather and festive seasons, among others.
His company is the sole sales representative/distributor for animal feed produced by Selasih Aman Sdn Bhd.
This, he said, is due to the fact that most farmers are able to cover the cost because prices of some of the raw materials used in the mixture of feed have dropped.
“In the past month or so, the farm price per kilo of chicken has been RM5 to RM6, but the prices fluctuate. We expect the animal feed market to experience a spike in the next two months following the implementation of the Sales and Service Tax (SST).
“For example, if we get the raw material like corn from Argentina and Brazil, the price is locked for three months, which means we can maintain the price for the animal feed for the next three months, even though the global price may go up and down.
“The effects can only be seen every three months because every farm or factory may have different locking price dates, which is why the price of chicken or meat varies,” he said in response to the SST on animal feed.
Mohd Izzuddin added that should the exemption be given overall or subsidised, it will directly help with operating costs, which in turn impacts the price of poultry.
Entrepreneur Amsyar Mohd Shori of Amsyar Farm Sdn Bhd said they use a mixture of different types of materials for each animal feed.
“We use different mixtures for chicken, meat and egg-producing chicken. We carry out the formula mixture process ourselves, so some of the materials have SST imposed upon them.
“This does affect the cost because the animal feed determines the price per kilo of chicken and meat, as well as eggs. Thus, the exemption given to the remaining feed raw materials is considered a needed item,” he explained.
Effective July 1, the government implemented the revised and expanded SST rate, as announced in Budget 2025.
A zero sales tax rate is maintained for livestock feed, which covers about 70%.
However, the remaining materials, such as raw soybean, canola meal, corn gluten meal, premix for broiler, rice husk and molasses, are subjected to a 5% sales tax.
